TMI Blog2014 (8) TMI 40X X X X Extracts X X X X X X X X Extracts X X X X ..... a sum of ₹ 25 Lakhs is concerned, the Tribunal was inclined to accept the reasoning of the CIT(A) that it is a case, where the assessee, under compelling circumstances, had accepted cash loan and, therefore no penalty need be levied by invoking the provisions of Section 273-B of the Act - Tribunal have gone into the genuineness of the transaction and the reasons attributed by the assessee for obtaining the loan in view of the compelling circumstances, which is covered by relevant documents to support a transaction and, the authorities have rightly interfered with the penalty imposed by invoking the provisions of Section 273-B of the Act – Decided against Revenue. - T.C. (A) NOS. 13 TO 15 OF 2014, M.P. NOS.1 OF 2014 - - - Dated:- 14-7-2014 - R. Sudhakar And G. M. Akbar Ali,JJ. For the Appellant : Mr. J. Narayanasamy JUDGMENT (Delivered By R. Sudhakar, J.) In all these appeals, the following questions of law have been raised :- i) Whether the Tribunal was justified in upholding the order of the Commissioner of Income Tax (Appeals) that no penalty is leviable under Sections 271-D and 271-E in a case of cash loan transaction recorded by the Department as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the assessment year 2009-2010 and payment of ₹ 50 Lakhs for the same assessment year is concerned, the appellate authority, placing reliance on the assessment order, where the amount has been treated as undisclosed income and subject to levy of tax under Section 68 of the Act, came to the conclusion that the Department having accepted the transaction as one of money coming from unexplained and unidentified source and, therefore, liable to tax under Section 68 of the Act, the provisions of Section 269-SS will not be attracted. ii) Insofar as the amount taken as loan from one Meenakshi is concerned, the Commissioner, relying upon certain details submitted by the assessee, held that the said amount received should be treated as a genuine transaction and in view of the compelling circumstances, thought it fit that it should not be subject to penalty by invoking the provisions of Section 273-B. 5. Assailing the order passed by the Commissioner of Income Tax (Appeals), the Revenue preferred a bunch of six appeals before the Income Tax Appellate Tribunal. The Appellate Tribunal, on consideration of the materials placed before it, concurred with the views of the Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... planation.--For the purposes of this section,-- (i) banking company means a company to which the Banking Regulation Act, 1949 (10 of 1949), applies and includes any bank or banking institution referred to in section 51 of that Act ; (ii) co-operative bank shall have the meaning assigned to it in Part V of the Banking Regulation Act, 1949 (10 of 1949) ; (iii) loan or deposit means loan or deposit of money. * * * * * * * * * 269T. Mode of repayment of certain loans or deposits. No branch of a banking company or a co-operative bank and no other company or co-operative society and no firm or other person shall repay any loan or deposit made with it otherwise than by an account payee cheque or account payee bank draft drawn in the name of the person who has made the loan or deposit if (a) the amount of the loan or deposit together with the interest, if any, payable thereon, or (b) the aggregate amount of the loans or deposits held by such person with the branch of the banking company or co-operative bank or, as the case may be, the other company or co-operative society or the firm, or other person either in his own name or jointly with any other person on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he *Joint Commissioner. 7. We find from the order of the Tribunal, in the case of transaction relating to receipt of ₹ 1 Crore and payment of ₹ 50 Lakhs, the Tribunal, having considered the order of the Assessing Authority that it is a case of unexplained cash receipt and treated as own income of the assessee, which is subjected to tax under Section 68 of the Act, held that the question of treating it as transaction in violation of Sections 269-SS or 269-T does not arise as it stands mutually excluded. 8. In this context, it would be useful to place reliance on the decision in Diwan Enterprisess V. Commissioner of Income-Tax and others (2000) 246 ITR 571), wherein the Delhi High Court held as follows :- That the Assessing Officer had discarded the theory of the assessee having taken any loan. He accepted the surrender of the amount as income of the assessee. It was open to the Assessing Officer not to accept the surrender, treat the amount as loan and then to hold the petitioner liable to penalty under section 271D for non-compliance with section 269SS. The Assessing Officer cannot be permitted to treat the amount of loan as income for the purpose of assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a different view as we find that the reasons of the Commissioner of Income Tax (Appeals), as observed by the Tribunal, justifies a case of undisclosed income at the hands of the assessee subject to tax under Section 68 of the Act. 11. Insofar as the loan transaction relatable to the money received from one Meenakshi for a sum of ₹ 25 Lakhs is concerned, the Tribunal, after considering the reasons for such a transaction, was inclined to accept the reasoning of the Commissioner of Income Tax (Appeals) that it is a case, where the assessee, under compelling circumstances, had accepted cash loan and, therefore no penalty need be levied by invoking the provisions of Section 273-B of the Act. In this context, it would be useful to refer to Section 273-B of the Act, which reads as under :- 273B. Penalty not to be imposed in certain cases.--Notwithstanding anything contained in the provisions of clause (b) of sub-section (1) of section 271, section 271A, section 271AA, section 271B, section 271BA, section 271BB, section 271C, section 271CA, section 271D, section 271E, section 271F, section 271FA, section 271FB, section 271G clause (c) or clause (d) of sub-section (1) or sub-se ..... 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