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2013 (10) TMI 1327 - ITAT CHENNAIPenalty under 271D and 271E - accepting of loans and repayment of loans in cash have resulted in violation of the provisions of law stated in Sections 269SS and 269T - CIT(A) deleted the penalties levied under Section 271D - Held that:- In the present case, all the transactions have been duly recorded in the books of the creditor as well as in the books of the assessees. The loans accepted by the assessees have been merged in the business finance of the assessees reflecting in their books of account. The funds required for repayment of loans were also generated out of the business as reflected in their books of account. The details of the parties are available on record. The assessees as well as lenders are all regularly assessed to income-tax. The identity of the parties are beyond doubt. The factum of loan and repayments are beyond doubt. The genuineness of the transactions is also not in doubt. It is also established by the assessees that there existed similar emergency for repaying the loan in cash, as the emergency which prompted them to take loans in cash. Therefore, this is a case where there is a reasonable cause for the assessees to repay the loans in cash. In such circumstances, it is to be seen that the violation of Section 269T is technical. Therefore, we find that the Commissioner of Income Tax (Appeals) ought have deleted the penalties levied under Section 271E, when in fact, for good reasons, he was deleting the penalties levied under Section 271D. - Decided in favour of assessee.
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