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2019 (10) TMI 238 - AT - Income TaxLevy of penalty u/s.271E - repayment of the loan in cash - reasonable cause in the violation of provisions of Section 269T - whether explanation offered by the assessee in response to show cause notice is reasonable or not? - HELD THAT:- The explanation of the assessee is that it was forced to repay the loan in cash on account of business expediency to meet the working capital limits of one the business concern in which he is interested; cannot be considered to be valid explanation for repayment of loan in cash. The fact that assessee accepted loan in cash and repaid the loan in cash goes to prove that there is active collusion with the lender in evading the taxes. In the absence of survey proceedings conducted in the premises of Shri. A. Kannan, this transaction would not have come to light. Valid explanation for acceptance of loan in cash, cannot a valid reason for repayment of loan in cash. Reliance placed by the Authorised Representative on the decision of Co-ordinate Bench in assessee’s own case for deletion of penalty for violation of provisions of Section 269SS of the Act does not hold good. Similarly, the ratio decision in the case of Manohar Lal Thakral [2011 (1) TMI 538 - PUNJAB AND HARYANA HIGH COURT] cannot be accepted having regard to the cogent reading of provisions of Section 269T and 275A of the Act. It is clear that the completion of assessment proceedings is not a condition precedent for initiation of penalty proceedings u/s.269T. Thus, we do not find any reason to interfere with the orders of the lower authorities. Hence, we confirm levy of penalty u/s.271E - Decided against assessee.
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