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2014 (12) TMI 848 - HC - Income TaxDeletion of penalty u/s 271D Revenue was of the view that assessee had taken unsecured loan of ₹ 8,52,71,500/- from M/s Oswal Agro Mills Ltd., otherwise than by an account payee cheque or bank draft in violation of Section 269SS Whether Section 269SS is violated if there is a book entry through journal and when there is no actual payment in cash - Held that:- Bona fides of the transactions and book entries were accepted by the Revenue the provision would not be violated mere book entries would not result in violation of Section 269SS and accordingly penalty u/s 271D cannot be sustained - there were mere book entries which had resulted in an amount becoming due and payable by the assessee to M/s Oswal Agro Mills ltd. - M/s Oswal Agro Mills Ltd. had not given any loan or deposit in cash or by way of money to the assessee - M/s Oswal Agro Mills Ltd. had made payments to third party creditors of the assessee - in view of the payments to the creditors, book entries were made in the journal of the assessee, acknowledging their liability to pay the amount to M/s Oswal Agro Mills Ltd. Decided against revenue.
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