Principal Commissioner Of Income-Tax-17 v. Goldfilled Mercantile Company

Ladda IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL No.967 of 2016 Principal Commissioner of Income-tax-17..Appellant.VsGoldfilled Mercantile Company..Respondent. Mr. Suresh Kumar, Advocate for the Appellant. Mr. H. Rai a/with Mr. Subhash Shetty Respondent. CORAM : AKIL KURESHI & B. P. COLABAWALLA, JJ. DATED :- 8TH JANUARY, 2019. P.C.: 1This appeal is filed by the Revenue challengingjudgment and order dated 16[th] September, 2015 passed by theIncome-tax Appellate Tribunal (“the Tribunal” for short). 2The Revenue has urged the following question of lawfor our consideration : “Whether on the facts and in the circumstances of the case and in lawthe ITAT was correct in deleting the penalty levied under Section 271(1) (c) of the Income Tax Act, 1961? 3Brief facts are as under :- The respondent assessee is a partnership firm. Theassessee had sold certain immovable property during the periodrelevant to the assessment year 2009-10 giving rise to capital gain.The case of the Assessee was that under a will of one of the partnersof the firm, a portion of such sale proceeds was to be given to threesisters in equal proportion of Rs. 4.5 Crores each. The firm actuallypaid such amount inclusive of tax payable on such receipt to thesisters. The assessee claimed the deduction of such payments whileoffering the receipts by way of capital gain in the return filed for thesaid assessment year 2009-10. 4The Assessing Officer did not accept the Assessee'scontention and insisted that the entire capital gain should have beenoffered by the firm itself. The assessee in such circumstance arguedthat in such case the tax paid on the amounts paid offered to thesisters may be given to the credit of. The Assessing Officer acceptedsuch requests. 5It was in this background that the Assessing Officerinitiated the penalty proceeded for their declaration of capital gainby the assessee. The Tribunal allowed the appeal and deleted the penalty on the ground that the assessee had putforth a bona fideclaim making full disclosures and no question of penalty wouldtherefore be arise. 6We are in agreement with the view of the Tribunal. TheAssessee had raised a claim giving full particulars thereof. Even ifsuch claim was found to be not sustainable, the penalty in any casecould not have been levied since the assessee had raised a bona fideclaim. 7In the result, the income-tax appeal is dismissed. (B.P. COLABAWALLA, J.) (AKIL KURESHI, J)