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2022 (3) TMI 154 - AT - Income TaxLevy of penalty u/s. 271D - violation of the provisions of Section 269SS - taking or accepting loans/ deposits in cash beyond a specified limit - HELD THAT:- The entries are in hundreds with date and signatures of the partner of the assessee firm against each of them. It is not established that the amount represented specified sums,nor that the amount mentioned in hundreds in the entries was actually in lacs as interpreted by the Revenue. The presumption of receipts in lacs, though on the basis of an entry against which CHQ was mentioned and which matched with a bank entry the same day in lacs, is not corroborated by way of any evidence, be it in the form of asset or any other document found with the assessee representing its alleged business receipts. Further in the absence of any name against each entry it is not established that each entry related to receipts from a person. Also that each entry represented cash receipt has no basis. The entire case of the Revenue rests on interpreting the entries in a diary found during search as relating to cash receipts from customers, on the basis of one of the entry having CHQ mentioned against it matching with a bank entry the same day. Treating this entry to be representative of the rest of the entries, the Revenue held that the entries related to business receipts in lacs and in the absence of CHQ mentioned against the entry it was presumed to be receipts in cash. Though it does create a preponderance of probability of the entries being of the same color as the CHQ entry and which may be sufficient for making addition in quantum proceedings, but the same is not sufficient to strictly establish the violation of section 269SS of the Act, of the assessee having received amounts in cash exceeding ₹ 20,000/- from a person on account of sale of flats, so as to attract levy of penalty u/s 271D of the Act. Revenue having not clearly established the violation of provisions of section 269SS of the Act by the assessee ,its entire case resting on interpretation of entry in a diary found during search,it is not a fit case for levy of penalty u/s 271D - Decided in favour of assessee.
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