TMI Blog2014 (5) TMI 665X X X X Extracts X X X X X X X X Extracts X X X X ..... th regard to investment of Mr. R.M. Zafarullah in the property - There is nothing on record to show that the assessee has taken loan from Mr. R.M. Zafarullah - Penalty proceeding have been initiated by drawing inferences from the transaction between the assessee and Mr. R.M. Zafarullah - penalty u/s. 271D has been levied on assumption that the assessee has violated the provisions of section 269SS by taking cash loan from Mr. R.M. Zafarullah - the penalty cannot be levied on the basis of presumptions and probabilities – thus, penalty u/s 271D of the Act is set aside – Decided in favour of Assessee. - I.T.A. No. 1997/Mds/2013 - - - Dated:- 12-5-2014 - Dr. O. K. Narayanan And Shri Vikas Awasthy,JJ. For the Appellant : Shri. Saroj Kum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Zafarullah as investment. The contention of the assessee with regard to investment by Mr. R.M. Zafarullah was accepted by the Assessing Officer. As regards loans advances from other persons, since the assessee could not substantiate his submissions, the Assessing Officer made additions for the same as unexplained investment. Later on, penalty proceedings were initiated against the assessee for taking cash loan from Mr. R.M. Zafarullah, thereby violating the provisions of Sec. 269SS. The Assessing Officer vide order dated 29.10.2012 levied penalty of I25,00,000/- u/s. 271D. In appeal, the Commissioner of Income Tax (Appeals) rejected the contentions of the assessee that it was not a cash loan but investment by Mr.R.M. Zafarullah. Aggri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.7.2008, the contents of which are reproduced in penalty order dated 29.10.2012. A perusal of the same shows that the assessee alongwith Mr. R.M. Zafarullah had jointly invested money to purchase property and thereafter share profit from its sale. The property was purchased on 11.7.2008 in the name of assessee. Subsequently, the property could not be sold and was retained by the assessee. The assessee repaid the amount invested by Mr. R.M. Zafarullah. Mr. R.M. Zafarullah has sworn an affidavit dated 27.06.2011 which was produced before the Assessing Officer wherein he has admitted the execution of MOU for purchase of property. The Assessing Officer in assessment order dated 26.09.2011 has accepted the contention of assessee with regard to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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