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2018 (1) TMI 1294 - ITAT KOLKATAPenalty u/s 271D - violation of conditions of section 269SS - taking unsecured loan in cash - Held that:- As rightly observed by the CIT(A), that during the appellate proceedings, the assessee filed copies of the drafts by which the payments were made. These drafts were available with the Assessing Officer and Additional Commissioner, the total amount paid through draft was at ₹ 26 lakhs. Regarding the balance amount of ₹ 3 lakhs, the assessee had shown them to be payments through two cheques with Nos. 390102 drawn against lndian Overseas bank for ₹ 1. 50 lakh and 390102 drawn on lndian Overseas Bank for an amount of ₹ 1. 50 lakh both dated 1. 6. 2006 in the name of Khairun Begum and Narmada Devi respectively. As regards, the other cheques payments, the assessee produced the relevant bank accounts. We find that there is nothing on record to show that any cash payments were actually made by any of the payers. The assessee has also filed the sale deeds in which the names of the sellers have been reflected. These transactions relate to before incorporation of the assessee company therefore the assessee company is not liable based on the factual position narrated above. There does not seem to be any reason for invoking the provisions of section 269SS either on the fact of the mode of such conveyance or on the legality of holding the assessee company responsible for acts committed before its incorporation. We quash the penalty order u/s 271D - Decided in favour of assessee.
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