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2012 (12) TMI 123 - ITAT DELHIPenalty u/s 271D of Income-tax Act – deposit or loan - adjustments through book entries - alleged that loan is not taken/accepted by the assessee through account payee cheques or account payee bank draft, in violation of the provisions of section 269SS of Income-tax Act - Held that:- Assessee executed a development agreement with M/s Duce for development of a residential township - In terms of the agreement, M/s Duce agreed to provide finance for purchase of land by the assessee company - M/S Duce made payments to vendors(land owners) on behalf of the assessee by account payee cheques towards purchase of land - penalty could not be levied in bonafide transactions - when by making the book entries the assessee has made the adjustment bona fide without having the knowledge that such book entries may render the assessee liable to penalty under section 271D of the Act on account of violation of the provisions of section 269SS of the Act - Bona fide belief coupled with the genuineness of the transactions will constitute reasonable cause for not invoking the provisions of section 271D of the Act – In favor of assessee
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