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2014 (7) TMI 137 - HC - Income TaxPenalty u/s 271D of the Act Exception to section 269SS of the Act Cash accepted exceeding the limit Genuineness of loan/ deposit transaction Held that:- A sum of ₹ 42.75 lakhs has been taken by way of loan by the respondent from ten different persons - this was by way of loan in cash exceeding rupees twenty thousands and the same therefore contravenes the provision of Section 269SS of the Act - reasonable cause had been sufficiently made out and when the very transactions were never doubted by the Revenue authorities, the breach is to be treated as a mere technical or venial breach - the requirement of Section 273B is for the assessee to prove that there was a reasonable cause for its having failed to abide by the provisions of Section 269SS - not only the substantiating evidence like 7/12 Extracts were produced, but, also additionally, transactions were reflected in the accounts of assessee and the advancement of loan to the assessee had been reflected in the books of account of those persons from whom the loan had been received - The identity of those persons has also been well established - assessee also had given satisfactory reason for taking such loan - His bona fide belief that such transactions would not attract provision of Section 269SS on the ground that they were agriculturists and lived in remote villages also was one of the grounds which has weighed with both the authorities. No error has been committed by both the authorities in deleting the penalty Relying upon Hindustan Steel Limited Versus State Of Orissa [1969 (8) TMI 31 - SUPREME Court] - an order imposing penalty for failure to carry out a statutory obligation is the result of a quasi criminal proceeding, and penalty will not ordinarily be imposed unless the party obliged, either acted deliberately in defiance of law or was guilty of conduct contumacious or dishonest, or act in conscious disregard to its obligation - Penalty will not also be imposed merely because it is lawful to do so - Even if a minimum penalty is prescribed, the authority competent to impose the penalty will be justified in refusing to impose penalty, when there is a technical or venial breach of the provisions of the Act or where the breach flows from a bona fide belief that the offender is not liable to act in the manner prescribed by the statute Thus, the order of the Tribunal is upheld Decided against Revenue.
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