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2024 (2) TMI 534 - AT - Income TaxPenalty levied u/s 271D - assessee has availed cash loan in contravention of provision of section 269SS - Assessee has submitted that though the assessee has initially availed loans from close relatives, which were subsequently the loans, were treated as gift and credited to his capital account, therefore, levy of penalty under section 271D of the Act is unwarranted - HELD THAT:- As perused the details furnished by the assessee, wherein, the assessee furnished copies of the confirmation letters from the lender, which were filed before the authorities below and find that assessee’s father-in-law as well as assessee’s wife, who have confirmed that the loan amount shall be treated as gift. The assessee’s mother passed away and produced death certificate. Moreover, the assessee has shown reasonable cause for receiving money towards purchase of machineries. Thus, we are of the opinion that the explanation offered against show cause notice before the authorities below were reasonable and therefore, levy of penalty under section 271D of the Act is untenable. As relying on case of Ms. Nanda Kumari v. ITO [2019 (1) TMI 413 - MADRAS HIGH COURT] we direct the Assessing Officer to delete the penalty levied under section 271D of the Act. Decided in favour of assessee.
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