Dy. Commissioner of Income Tax-4, Kanpur V. M/s. Tread Stone Ltd., Kanpur

ITA 399/LKW/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 3344 (ITAT-LUCKNOW)
• Duration Of Justice: 10 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-06-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 21-03-2013
• Assessment Year: 2004-2005
• Appeal Filed On: 18-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALOK MITRA
• Keywords: Unexplained cash credit; Source of fund
• Section: 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A : LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER I.T.A. NO. 399 /LKW/201 2 ASSESSMENT YEAR: 2004 - 05 DY. C.I.T. - 4, VS. M/S TREAD STONE LTD., KANPUR. 39, FACTORY AREA, FAZALGANJ, KANPUR. PAN:AAACL2544H (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ALOK MITRA, D.R. RESPONDENT BY : SHRI RAKESH GARG, ADVOCATE DATE OF HEARING :2 1 /03/2013 DATE OF PRONOUNCEMENT :07/06/2013 ORDER PER SUNIL KUMAR YADAV: THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST THE ORDER OF CIT(A) DELETING THE PENALTY LEVIED U/S 271(1)(C) OF THE I.T. ACT, 1961. 2. THE FACTS IN BRIEF, CULLED OUT FROM THE ORDERS OF THE AUTHORITIES BELOW, ARE THAT THE ASSESSEE COMPANY HAD FILED ITS RETURN DECLARING INCOME OF ` 1,92,10,350/ - AND THE ASSESSMENT WAS FRAMED ON TOTAL INCOME OF ` 2,31,13,640/ - AFTER MAKING THE ADDITIONS ON ACCOUNT OF D IVIDEND INCOME AT ` 76,037/ - AND UNDISCLOSED LONG TERM CAPITAL GAIN AT ` 32,72,195/ - . THE 2 ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT HAS HELD THAT THE ASSESSEE HAD DISCLOSED THE AFORESAID TWO ITEMS UNDER THE HEAD OTHER RECEIPTS, UNDER THE HEAD DIVIDE ND INCOME. ACCORDING TO THE ASSESSING OFFICER THE ASSESSEE SHOULD HAVE DECLARED THE AFORESAID TWO ITEMS SEPARATELY AND SHOULD NOT HAVE DECLARED UNDER THE HEAD DIVIDEND INCOME AND CLAIMED IT EXEMPT U/S 10 OF THE ACT. IT WAS STATED BEFORE THE ASSESSING OFF ICER THAT THE AUDITOR S ON THEIR PART HAVE PREPARED THE INCOME AND EXPENDITURE ACCOUNT AND HAD GROUPED VARIOUS SOURCES OF INCOME UNDER DIFFERENT GROUP HEADING. THE AUDITORS HAD INCLUDED THE ENTIRE AMOUNT IN DISPUTE UNDER THE HEAD DIVIDEND AND W ERE DISCLO SED UNDER THE HEAD OTHER INCOME IN THE PROFIT & LOSS ACCOUNT. IN OTHER WORDS , THE ASSESSEE HAD DECLARED A SUM OF ` 57,68,257/ - UNDER THE HEAD OTHER INCOME AS DIVIDEND. THE COMPLETE BREAK - UP WAS GIVEN IN SCHEDULE - R OF THE BALANCE SHEET. THE AFORESAID AMOUNT OF ` 57,68,257/ - INCLUDED THE FOLLOWING: ( I ) LONG TERM CAPITAL GAIN ` 32,72,195/ - ( II ) DIVIDEND ` 24,96,063/ - THE ASSESSING OFFICER NOTICED THAT IN RESPECT OF THE DIVIDEND INCOME OF ` 24,96,063/ - THERE WAS A CREDIT ENTRY OF ` 76,037/ - FOR WHICH NO DETAILS WERE AVAILABLE. THE ASSESSING OFFICER TREATED THE SAID AMOUNT AS UNEXPLAINED CREDIT IN THE BANK AND MADE THE ADDITION OF THE SAME . AS FAR AS THE ADDITION OF ` 32,72,194/ - IS CONCERNED, THE SAME WAS LONG TERM CAPITAL GAIN IN RESPECT OF SECURITIES B UT WAS CLAIMED AS EXEMPT AND WAS CLUBBED UNDER THE HEAD DIVIDEND. COMPLETE DETAILS OF PURCHASE AND SALE OF SECURIT IES IN MUTUAL FUNDS WAS FILED. THE ASSESSING OFFICER TAXED THE 3 AFORESAID AMOUNT OF ` 32,72,195/ - AS LONG TERM CAPITAL GAINS. THE ASSESSING OFFICER OBSERVED THAT THIS AMOUNT OF LONG TERM CAPITAL GAINS WAS NOT INCLUDED IN THE TOTAL INCOME DECLARED BY THE ASSESSES AND WAS CLAIMED AS EXEMPT UNDER THE HEAD DIVIDEND. HE ACCORDINGLY MADE THE ADDITION OF THE SAME AND INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT FOR FURNISHING INACCURATE PARTICULARS OF INCOME IN RESPECT OF LONG TERM CAPITAL GAINS CLAIMED AS 'DIVIDEND'. IN RESPONSE THERETO, T HE ASSESSEE HAS EXPLAINED THAT THERE WAS NO INTENTION ON ITS PART TO FURNISH ANY INACCU RATE PARTICULARS OF INCOME. THE ASSESSEE'S MAIN SOURCE OF INCOME WAS FROM EXPORT OF LEATHER GOODS AND DIVIDEND/CAPITAL GAINS CONSTITUTED A VERY NOMINAL PORTION OF THE INCOME. MOREOVER THE ENTIRE AUDIT AND PREPARATION OF RETURN WAS DONE BY THE AUDITORS. THEREFORE, WHATEVER ERROR HAS BEEN COMMITTED, IT WAS BY THE AUDITORS AND BEING EXPERT IN THE FIELD , THE ASSESSEE HAS RELIED ON THE AUDIT REPORT AND RETURN PREPARED BY THE AUDITORS. BEING NOT CONVINCED WITH THE EXPLANATION OF THE ASSESSEE, THE ASSESSING OF FICER HAS IMPOSED PENALTY OF ` 7,00,000/ - VIDE ORDER DATED 22 / 06 / 2007. 3. THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) WITH THE SUBMISSIONS THAT THE ASSESSEE HAS NOT FURNISHED INACCURATE PARTICULARS OF INCOME . THE HEADS OF INCOME WERE DULY DISCLOSED. THE DETAILS OF INCOME ARE LONG TERM CAPITAL GAINS ON PURCHASE AND SALE OF MUTUAL FU NDS AND INCOME FROM DIVIDEND. IT APPEARS THAT UNDER SOME MISNOTION ON THE AUDITORS PART, BOTH INCOME FROM LONG TERM CAPITAL GAINS AND INCOME FROM DIVIDEND WAS C LUBBED UNDER THE HEAD DIVIDEND AND CLAIMED EXEMPT. AS FAR AS LONG TERM CAPITAL GAIN AMOUNTING TO ` 32,72,195/ - IS CONCERNED, THE SAME WAS OUGHT TO BE EXEMPT BEING LIABLE FOR STT. PERHAPS THE AUDITORS 4 MIGHT HAVE BEEN UNDER THE IMPRESSION THAT SINCE THE L ONG TERM CAPITAL GAIN WAS ON ACCOUNT OF SALE OF UNITS (SECURITIES) , THE SAME WOULD BE EXEMPT FROM TAX. AS FAR AS DIVIDEND INCOME IS CONCERNED, THE SAME IS EXEMPT. SINCE THE DETAILS OF ` 76,037/ - WAS NOT AVAILABLE AT THE RELEVANT POINT OF TIME, THE ASSESSING OFFICER TREATED IT AS UNEXPLAINED DEPOSIT IN BANK. THE FACT IS THAT THE SAME IS DIVIDEND AND DIVIDEND IS EXEMPT FROM TAX U/S 10 OF THE I. T. ACT., WHICH IS NOT IN DISPUTE. IT WAS FURTHER CONTENDED BEFORE THE CIT(A) THAT THE HEAD OF I NCOME HAS BEEN CHANGED INADVERTENTLY AND THAT TOO ON ACCOUNT OF UNAWARENESS ON THE PART OF THE ASSESSEE, THEREFORE, THE SAME SHOULD NOT BE TAKEN AS A GROUND TO INFER THAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME. HE PLACED RELIANCE UPON THE JUDGMENT OF HON'BLE DELHI HIGH COURT IN THE CASE OF DCIT VS. JMD ADVISORS PVT. LTD. 310 (AT) 380 WHEREIN THE PENALTY WAS SOUGHT TO BE LEVIED BY THE ASSESSING OFFICER FOR CONCEALMENT OF INCOME WHERE THE ASSESSEE WAS IN THE BUSINESS OF REAL ESTATE. IN THAT CASE LOSS ON SALE OF PROPERTY WAS TREATED AS BUSINESS LOSS BUT WAS TAXED AS LONG TERM CAPITAL GAIN BY THE INCOME TAX OFFICER. IN APPEAL THE TRIBUNAL HAS HELD THAT CHANGE OF HEAD OF INCOME BY THE ASSESSING OFFICER COULD NOT BE CONSTRUED AS CONCEALMENT . THE TRIBUNAL APPRECIATED THAT THE ASSESSEE HAS DISCLOSED ALL THE MATERIAL FACTS NECESSARY FOR THE PURPOSE OF ASSESSMENT, BUT HAD WRONGLY CLAIMED THE LOSS ON SALE OF PROPERTY AS A BUSINESS LOSS AS AGAINST CAPITAL GAINS. THE TRIBUNAL ACCORDINGLY DELETED THE PENALTY. THE LEARNED COUNSEL FURTHER PLACED RELIANCE UPON THE JUDGMENT IN THE CASE OF CIT VS. S. PADMANABBAN [2006] 284 ITR 535 (KAR), CIT VS. VAMCHAMPIGONS & AGRO PRODUCTS [2006] 284 ITR 408 (DEL) , COMMISSIONER OF INCOME - TAX VS SANTHOSH FAMILY TRUST [2001] 247 ITR 742 5 (KER) AND ADDITIONAL COMMISSIONER OF INCOME - TAX VS JEEVAN LAL SAH [1994] 205 ITR 244 (SC) . THE CIT(A) RE - EXAMINED THE ISSUE IN THE LIGHT OF THE ASSESSEES CONTENTION AND BEING CONVINCED WITH THE EXPLANATION OF THE ASSESSEE, THE CIT(A) HAS DELETED THE PENALTY LEVIED ON ACCOUNT OF LONG TERM CAPITAL GAINS BUT DIRECTED THE ASSESSING OFFICER TO RE - COMPUTE THE PENALTY U/S 271(1)(C) OF THE ACT @100% ON TAX SOUGHT TO BE EVADED ON INCOME OF ` 76,037/ - . THE RELEVANT OBSERVATIONS OF CIT(A) ARE EX TRACTED HEREUNDER: I H AVE GONE THROUGH THE FACTS OF THE CASE AND ALSO THE DETAILED SUBMISSIONS MADE BY THE LD. A.R. IN THIS REGARD. THERE IS NO DISPUTE/CONTROVERSY WITH REGARD TO THE FACT THAT THE ASSESSEE HAD EARNED LONG TERM CAPITAL GAINS AMOUNTING TO ` 32,72,195 / - WHICH HAD NOT BEEN OFFERED TO TAX BY THE ASSESSEE. I ALSO FIND FROM THE RECORDS THAT THERE WAS AN APPARENT MISTAKE ON THE PART OF THE AUDITOR, AS HE HAD INCLUDED THE SAID CAPITAL GAIN UNDER THE HEAD, 'OTHER INCOME', BREAK - UP OF WHICH WAS GIVEN IN SCHEDULE - R. ON PERUSAL OF THE SAID SCHEDULE - R, I FIND THAT THERE IS NO MENTION OF CAPITAL GAINS, BUT IT GIVES AN AMOUNT OF ` 57,68,257.67 / - AS 'DIVIDEND EARNED'. IT SEEMS THAT T H E ASSESSEE COMPANY'S TAX ADVISOR, WHO PREPARED THE RETURN ACCORDING TO THE AUDITED FINANCIAL STATEMENTS, CLAIMED AN AMOUNT OF ` 57,68,257/ - ON ACCOUNT OF DIVIDEND AS EXEMPT U/S 10(38) OF THE IT ACT. AS THINGS EMERGED DURING THE COURSE OF ASSESSMENT, OUT OF THAT ` 57,68,257.67/ - , ONLY A SUM OF ` 24,96,063/ - WAS ON ACCOUNT OF DIVIDEN D INCOME AND THE BALANCE ` 32,72,195/ - WAS ON ACCOUNT OF LONG TERM CAPITAL GAINS. NOW THE ISSUE IS WHETHER THE ASSESSEE IS LIABLE FOR PENALTY U/S 271(1)(C) OF THE ACT FOR SUCH OMISSION ? NO DOUBT, IT IS THE DUTY AND LEGAL OBLIGATION OF THE ASSESSEE TO FILE A PROPER RETURN OF INCOME. BUT ONE CANNOT DENY THE PRACTICAL REALITIES OF LIFE, I.E. IN THE PRESENT COMPLEX LEGAL SCENARIO, PREPARATION AND FILING OF RETURN IS GENERALLY BEING HANDLED BY THE TAX EXPERTS RATHER THAN THE ASSESSEES THEMSELVES. THE TAX ADVISOR PREPARES THE RETURN OF INCOME IN 6 ACCORDANCE WITH THE AUDITED ACCOUNTS, WHICH AS DISCUSSED ABOVE HAD SHOWN AN AMOUNT OF ` 57 , 68 , 257 / - AS 'DIVIDEND EARNED'. THUS, THE TAX ADVISOR WOULD HAVE HAD NO REASON NOT TO BELIEVE OR NOT TO GO BY THE FIGURES STATED IN SUCH AUDITED ACCOUNTS. THE ROOT CAUSE OF ALL SUCH MI STAKE AND OMISSION LIES IN MISREPORTING OF DIVIDEND INCOME B Y THE STATUTORY AUDITORS. THE ASSESSEE COMPANY CANNOT BE FAULTED WITH SUCH MISREPORTING BY THE AUDITOR. IN THIS VIEW OF THE MATTER, I AM OF THE CONSIDERED VIEW THAT THE EXPLANATION GIVEN BY THE ASSESSEE COMPANY IN THIS REGARD IS REASONABLE AND 'BONA FIDE' OF THE ASSESSEE IN THIS REGARD HAVE BEEN CLEARLY DEMONSTRATED. THUS, PENALTY LEVIED ON ACCOUNT OF OMISSION TO RETURN LONG TERM CAPITAL GAINS OF ` 32,72,195 / - CANNOT BE SUSTAINED. HOWEVER, AS REGARDS THE NON FURNISHING OF DETAILS IN RESPECT OF ` 76,037 / - (WHICH WAS CLAIMED AS EXEMP T ON ACCOUNT OF DIVIDEND INCOME), THE ASSESSEE IS LIABLE FOR PENALTY U/S 271(1)(C) SINCE THE ASSESSEE FAILED TO OFFER ANY REASONABLE EXPLANATION, NOR HAVE THE BONA FIDE OF THE ASSESSEE BEING PROVEN. ACCORDINGLY, THE A.O. IS DIRECTED TO RE - COMPUTE THE PENAL TY U/S 271( 1 )(C) @ 100% ON TAX SOUGHT TO BE EVADED ONLY ON AN INCOME OF ` 76,037 / - . THE A.O. IS FURTHER DIRECTED TO ISSUE A SHOW CAUSE NOTICE TO THE AUDITOR FOR SUCH MIS - REPORTING IN THE AUDITED ACCOUNTS. 4. AGGRIEVED, THE REVENUE HAS PREFERRED AN APPEAL BEFORE THE TRIBUNAL AND PLACED HEAVY RELIANCE UPON THE ORDER OF THE ASSESSING OFFICER. 5. THE LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, HAS SUBMITTED THAT IT HAS MADE THE DISCLOSURE OF ALL THE RECEIPTS AND WHATEVER CONFUSION WAS OCCURRED IT WAS ON ACCOUNT OF REGROUPING BY THE AUDITOR. SINCE THE AUDITOR WAS CONSIDERED TO BE EXPERT IN THE FIELD, THE ASSESSEE HAS RELIED UPON HIM AND ACCORDINGLY THE RETURNS WERE FILED , THEREFORE, THE NEGLIGENCE OR FURNISHING THE INACCURATE PARTICULARS CANNOT BE ATTRIBUTED TO THE ASSESSEE. IN SUPPORT OF HIS CONTENTION HE PLACED RELIANCE UPON THE 7 JUDGMENT OF HON'BLE AP HIGH COURT IN THE CASE OF CIT VS. SANIA MIRZA, I.T.A. NO. 526 OF 2011 DATED 09/02/2012, CIT VS. BENNETT COLEMAN & CO. LTD. (BOMBAY HIGH COURT) INCOME TAX APPEAL (LOD) NO.2117 OF 2012 DATED 26/02/2013 AND PRICE WATERHOUSE COOPERS PVT. LTD. VS. CIT (SC) CIVIL APPEAL NO. 6924 OF 2012 ORDER DATED 25/09/2012. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND FROM THE CAREFUL PERUSAL OF THE RECORD WE FIND THAT UNDISPUTEDLY THE ASSESSEE HAS DISCLOSED THE RECEIPT OF LONG TERM CAPITAL GAINS AND DIVIDEND INCOME. THE LONG TERM CAPITAL GAIN WAS GROUPED UNDER THE HEAD OF DIVIDE ND INCOME AND CLAIMED EXEMPT U/S 10 OF THE ACT BY THE AUDITOR. THE AUDITOR HAS UNDERTAKEN THIS EXERCISE UNDER THE MISCONCEPTION, WHICH WAS NOTICED BY THE ASSESSING OFFICER AND MADE THE ADDITIONS OF THE SAME BESIDES LEVYING THE PENALTY U/S 271(1)(C) OF THE ACT. BEFORE THE CIT(A) , THE ASSESSEE HAS TRIED TO ESTABLISH THAT THE RE - GROUPING OF THE CAPITAL GAINS UNDER THE HEAD DIVIDEND WAS DONE BY THE AUDITOR AND HE HAS PLACED RELIANCE UPON HIS PREPARATION OF AUDIT REPORT HAVING CONSIDERED HIM TO BE EXPERT IN THE FIELD. SINCE THERE WAS NO WILLFUL DEFAULT ON THE PART OF THE ASSESSEE FOR GROUPING THE LONG TERM CAPITAL GAINS UNDER THE HEAD DIVIDEND, THE P ENALTY SHOULD NOT BE FASTENED AGAINST HIM. WE HAVE CAREFULLY EXAMINED THE JUDGMENT PUT FORTH BY THE PARTIES AND WE FIND THAT IN THE CASE OF SANIA MIRZA , THEIR LORDSHIPS OF A.P. HIGH COURT HAVE HELD THAT THERE IS NOTHING TO SUGGEST THAT THE ASSESSEE ACTED IN A MANNER SUCH AS TO LEAD TO THE CONCLUSION THAT SHE HAD CONCEALED THE PARTICULARS OF HER INCOME OR HAD FURNISHED INACCURATE PARTICULARS OF INCOME. THAT BEING THE POSITION, IT CANNOT BE SAID THAT THERE WAS ANY CONCEALMENT. THERE IS NO DISPUTE ABOUT TH E FACT THAT THE AMOUNT WAS CORRECTLY MENTIONED AND THEREFORE, THERE WAS NOTHING INACCURATE IN THE PARTICULARS FURNISHED BY HER . 8 THE HON'BLE HIGH COURT ACCORDINGLY HELD THAT IN SUCH TYPE OF SITUATION, PENALTY U/S 271(1)(C) OF THE ACT CANNOT BE LEVIED. 6.1 SIMILAR IS THE POSITION IN THE CASE OF BENNETT COLEMAN & CO. LTD. IN WHICH THE HON'BLE BOMBAY HIGH COURT HAS HELD THAT WHERE THERE IS ONLY CHANGE OF HEAD OF INCOME AND IN THE ABSENCE OF ANY FACT THAT THE CLAIM OF THE ASSESSEE WAS NOT BONA FIDE, THE PENALT Y U/S 271(1)(C) OF THE ACT CANNOT BE IMPOSED. ACCORDINGLY, THE HON'BLE BOMBAY HIGH COURT HAS CONFIRMED THE ORDER OF THE TRIBUNAL WHEREBY THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT WAS DELETED. 6.2 SIMILAR WAS THE POSITION IN THE CASE OF PRICE WATERHOUSE COOPERS PVT. LTD. AND THE HON'BLE SUPREME COURT HAS CATEGORICALLY HELD THAT PENALTY SHOULD NOT BE LEVIED WHERE THE ASSESSEE HAD COMMITTED INADVERTENT AND BONA FIDE ERROR AND HAD NOT INTENDED TO OR ATTEMPTED TO EITHER CONCEAL ITS INCOME OR FURNISH INACCURA TE PARTICULARS. THE RELEVANT OBSERVATIONS OF HON'BLE SUPREME COURT ARE EXTRACTED HEREUNDER FOR THE SAKE OF REFERENCE: 17. HAVING HEARD LEARNED COUNSEL FOR THE PARTIES, WE ARE OF THE VIEW THAT THE FACTS OF THE CASE ARE RATHER PECULIAR AND SOMEWHAT UNIQUE . THE ASSESSEE IS UNDOUBTEDLY A REPUTED FIRM AND HAS GREAT EXPERTISE AVAILABLE WITH IT. NOTWITHSTANDING THIS, IT IS POSSIBLE THAT EVEN THE ASSESSEE COULD MAKE A 'SILLY' MISTAKE AND INDEED THIS HAS BEEN ACKNOWLEDGED BOTH BY THE TRIBUNAL AS WELL AS BY THE HI GH COURT. 18. THE FACT THAT THE TAX AUDIT REPORT WAS FILED ALONG WITH THE RETURN AND THAT IT UNEQUIVOCALLY STATED THAT THE PROVISION FOR PAYMENT WAS NOT ALLOWABLE UNDER SECTION 9 40A(7) OF THE ACT INDICATES THAT THE ASSESSEE MADE A COMPUTATION ERROR IN ITS RETURN OF INCOME. APART FROM THE FACT THAT THE ASSESSEE DID NOT NOTICE THE ERROR, IT WAS NOT EVEN NOTICED EVEN BY THE ASSESSING OFFICER WHO FRAMED THE ASSESSMENT ORDER. IN THAT SENSE, EVEN THE ASSESSING OFFICER SEEMS TO HAVE MADE A MISTAKE IN OVERLOOKING T HE CONTENTS OF THE TAX AUDIT REPORT. 19. THE CONTENTS OF THE TAX AUDIT REPORT SUGGEST THAT THERE IS NO QUESTION OF THE ASSESSEE CONCEALING ITS INCOME. THERE IS ALSO NO QUESTION OF THE ASSESSEE FURNISHING ANY INACCURATE PARTICULARS. IT APPEARS TO US THAT A LL THAT HAS HAPPENED IN THE PRESENT CASE IS THAT THROUGH A BONA FIDE AND INADVERTENT ERROR, THE ASSESSEE WHILE SUBMITTING ITS RETURN, FAILED TO ADD THE PROVISION FOR GRATUITY TO ITS TOTAL INCOME. THIS CAN ONLY BE DESCRIBED AS A HUMAN ERROR WHICH WE ARE ALL PRONE TO MAKE. THE CALIBER AND EXPERTISE OF THE ASSESSEE HAS LITTLE OR NOTHING TO DO WITH THE INADVERTENT ERROR. THAT THE ASSESSEE SHOULD HAVE BEEN CAREFUL CANNOT BE DOUBTED, BUT THE ABSENCE OF DUE CARE, IN A CASE SUCH AS THE PRESENT, DOES NOT MEAN THAT T HE ASSESSEE IS GUILTY OF EITHER FURNISHING INACCURATE PARTICULARS OR ATTEMPTING TO CONCEAL ITS INCOME. 20. WE ARE OF THE OPINION, GIVEN THE PECULIAR FACTS OF THIS CASE, THAT THE IMPOSITION OF PENALTY ON THE ASSESSEE IS NOT JUSTIFIED. WE ARE SATISFIED THAT THE ASSESSEE HAD COMMITTED AN INADVERTENT AND BONA FIDE ERROR AND HAD NOT INTENDED TO OR ATTEMPTED TO EITHER CONCEAL ITS INCOME OR FURNISH INACCURATE PARTICULARS. 6.3 T URNING TO THE FACTS OF THE CASE, WE FIND THAT THE ASSESSEE HAS DECLARED THE RECEIPTS OF LONG TERM CAPITAL GAIN AS WELL AS DIVIDEND INCOME BUT LONG TERM CAPITAL GAINS WAS WRONGLY CLUBBED BY ITS AUDITOR UNDER THE HEAD DIVIDEND AND CLAIMED EXEMPTION U/S 10 OF THE AC T INADVERTENTLY OR UNDER THE MISCONCEIVED N OTION FOR WHICH THE ASSESSEE CANNOT BE HELD 10 RESPONSIBLE. WHATEVER ERROR WAS COMMITTED IN THE GROUPING OF INCOME UNDER DIFFERENT HEADS, IT WAS NOT DONE BY THE ASSESSEE. IT WAS DONE BY THE AUDITOR AND FOR THE MIST AKES OF THE AUDITOR ASSESSEE CANNOT SUFFER. THEREFORE, RELYING UPON THE AFORESAID JUDGMENTS, WE ARE OF THE VIEW THAT THE CIT(A) HAS RIGHTLY DELETED THE PENALTY IN THE INSTANT CASE AND WE FIND OURSELVES IN AGREEMENT WITH THE CONCLUSION OF CIT(A). ACCORDING LY, WE CONFIRM HIS ORDER. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 07/06/2013 ) SD /. SD/. (J. SUDHAKAR REDDY ) (SUNIL KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 0 7/06/2013 *CL SINGH COPY FORWARDED TO THE: 1. APPELLANT. 2. RESPONDENT. 3. CIT (A) 4. CIT 5. DR. ASSISTANT REGISTRAR