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2014 (12) TMI 848 - HC - Income TaxDeletion of penalty u/s 271D – Revenue was of the view that assessee had taken unsecured loan of ₹ 8,52,71,500/- from M/s Oswal Agro Mills Ltd., otherwise than by an account payee cheque or bank draft in violation of Section 269SS – Whether Section 269SS is violated if there is a book entry through journal and when there is no actual payment in cash - Held that:- Bona fides of the transactions and book entries were accepted by the Revenue – the provision would not be violated –mere book entries would not result in violation of Section 269SS and accordingly penalty u/s 271D cannot be sustained - there were mere book entries which had resulted in an amount becoming due and payable by the assessee to M/s Oswal Agro Mills ltd. - M/s Oswal Agro Mills Ltd. had not given any loan or deposit in cash or by way of money to the assessee - M/s Oswal Agro Mills Ltd. had made payments to third party creditors of the assessee - in view of the payments to the creditors, book entries were made in the journal of the assessee, acknowledging their liability to pay the amount to M/s Oswal Agro Mills Ltd. – Decided against revenue.
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