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2017 (8) TMI 1539 - AT - Income TaxPenalty u/s 271D - unexplained income of the assessee - contravening the provisions of Section 269SS HELD THAT:- A.O. made addition of the aforesaid amounts considering it to be unexplained income of the assessee. In the assessment order, the A.O. did not record any satisfaction contravening the provisions of Section 269SS of the I.T. Act. When the Ld. CIT(A) deleted the additions on merit, the A.O. initiated the penalty proceedings under section 271D of the I.T. Act against the assessee. Therefore, the issue is covered in favour of the assessee by judgment of CIT vs. Jai Laxmi Rice Mills [2015 (11) TMI 1453 - SUPREME COURT] CIT(A) found on examination of the material on record that assessee entered into the genuine transactions and funds are transferred inter-se between assessee and the AOP which are recorded in the books of account. Since for renewal of the licence of liquor business, immediate cash is required for obtaining the licence from the Government, assessee had taken cash. Therefore, Ld. CIT(A) found reasonable cause for failure to comply with the above provision. Therefore, penalty was rightly cancelled - Decided in favour of assessee
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