The Commissioner Of Income Tax – 25, Mumbai v. Sunil S. Rathi

IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL (L) NO.883 OF 2011 The Commissioner of Income Tax – 25, Mumbai..Appellant. Versus Sunil S. Rathi..Respondent. Ms.Suchitra Kamble for the appellant.Mr.Vipul Joshi for the respondent. CORAM : J.P. Devadhar &K.K. Tated, JJ. P.C. : DATE : 8th September 2011 1.Whether the Income Tax Appellate Tribunal was justified in deleting the penalty levied under Section 271(1)(c) of the Income Tax Act, 1961 is the question raised in this appeal. 2.In the present case, the dispute is whether the assessee was justified in claiming the loss arising from the sale of shares as business loss instead of claiming it as capital loss. The Income Tax Appellate Tribunal has recorded a finding of fact that the assessee was under a bona fide belief that the loss arising on sale of shares were liable to be allowed as business loss and such a claim made by the assessee would not amount to concealing the particulars of income or furnishing inaccurate particulars of income. Whether the loss is allowable as a business loss or as a capital loss is a matter of inference to be drawn and if a bona fide inference drawn by the assessee is found to be wrong, it cannot be said that the assessee has concealed particulars of income or furnished inaccurate particulars of income as contemplated under Section 271(1)(c) of the Act. 3.In the result, we see no merit in the appeal. The appeal is accordingly dismissed with no order as to costs. (K.K. Tated, J.) (J.P. Devadhar, J.)