2023 (3) TMI 761 - AT - Income Tax

Penalty u/s. 271-D - sale proceeds of a specific flat were received in cash by the assessee on five different occasions - statutorily relief as specifically provided u/s. 273-B - HELD THAT:- The supporting argument for the justification in accepting cash on 5 different occasions canvassing that the assessee's action was prudent as she could not rely upon the purchaser to make payments by cheques which may or may not be honoured and as argued before FAA that getting the amount deposited by way of RTGS/Cheque in her Jagraon account and then travelling with cash withdrawn at Jagraon to Delhi to make purchases was considered to be unsafe/impractical and alternatively/simultaneously it is seen that as per record, it is also pleaded possibly that there was a limit of cash withdrawals from ATMs. These submissions on record even if canvassed by hind sight to justify that the assessee chose the simplest and surest way of accepting the sale proceeds in Delhi and used the same for making purchases in Delhi for the oncoming marriage of her daughter also in Delhi remain un-rebutted.

Ignorance of law - As it is necessary to keep in mind the provisions of law invoked. The issue is not to be decided on the plea of ignorance of law and is to be considered under the umbrella provision of Section 273B of the Income Tax Act, 1961. Thus, the pleading that the assessee was in ignorance of law at best can be considered to be a submission so as to argue that it is not a case of willful and deliberate defiance of law on the part of the assessee.

In this case admittedly the assessee has led sufficient explanations consistently on record with evidence which remains unrebutted to plead a reasonable cause. No doubt, what would constitute a reasonable cause cannot be specifically defined by any clear definition it is to be considered on the basis of all the possible factors which may come into play for the actions of the assessee. The very expression 'reasonable cause' itself cannot be satisfactorily defined for all purposes, times and situations.

The simple dictionary meaning of 'reasonable' is fair, practical and sensible. Over a period of time, it has been seen that a reasonable cause is a standard of proof that is applied to a set of facts or actions to prove whether a reasonable person would have come to the same conclusion or acted in the same way given the totality of the circumstances. Thus, it can be fairly described as an exercise to determine whether a rationale basis for action taken is available on record or not. It may be necessary to also weigh judiciously whether the actions are excessive or moderate to address the situation. Applying these yardsticks, considering the consistent explanation available on record, we are satisfied that the assessee has successfully made out a case demonstrating that there was a reasonable cause for her to accept payments on the specific dates and thus, the bona fide explanation offered by the assessee in the peculiar facts of the present case - Decided in favour of assessee.