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2021 (1) TMI 408 - AT - Income TaxPenalty u/s. 271E - Cash paid towards repayment of finance obtain for purchase of trucks - The payment was made in cash on due dates to avoid the default in repayment of loan, which would effect assessee's credibility in CIBIL and to avoid penalty for default, as on that date of such payments, signed cheque books were not available with the staff - For repayment of cash of L & T Finance Ltd. as submitted that the account had to be closed immediately, so as to clear the finance, obtain a NOC so as to sell a lorry - HELD THAT:- Penalty in this case has to be deleted, the assessee was prevented by the reasonable cause in making the repayment of finances otherwise than by way of cheque. Even otherwise the transactions are genuine. Both the Assessing Officer as well as the Ld. CIT(A) have not doubted the genuineness of the transactions. It is also not clear whether the finance obtained is, a lease finance or hire purchase finance. The assessee has explained the urgency leading to payment of instalment in cash. The lender have confirmed this fact. It is a fact that CBIL ratings are efficiently resulting in effect on business. When the transactions were genuine, then the violation of question is only a technical and venial. The Hon'ble Supreme Court in the case of Hindustan Steel Ltd. vs. State of Orissa [1969 (8) TMI 31 - SUPREME COURT] (supra) held that no penalty can be levied when the violation is technical and venial. Penalty in question is to be deleted - Decided in favour of assessee.
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