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2016 (9) TMI 546 - AT - Income TaxPenalties levied u/s 271D and 271E - violation of the provisions of sec. 269SS and 269T - Held that:- The various case laws have held that the loan/deposit received by way of cash to meet the urgent business requirements can be considered to be a reasonable cause and in that kind of situation the penalty u/s 271D cannot be levied. However, it is the responsibility of the assessee to prove that there was urgent business requirement on the day when the loan/deposit was received by way of cash. The assessee may prove the same on the basis of books of accounts and other documents. Accordingly, we are of the view that this issue relating to penalty levied u/s 271D of the Act may be set aside to the file of the Addl. CIT for fresh examination. In respect of the loan/deposit repaid in cash, the explanation with regard to urgent business requirements shall not apply. However, since the issue relating to penalty levied u/s 271D has been set aside to the file of Addl, CIT, we are of the view that, in the interest of natural justice, the assessee should be provided with one more opportunity to show the reasonable cause in making payment of loan/deposit by way of cash.In view of the foregoing discussions, we set aside both the orders passed by Ld CIT(A) and restore the issue to the file of the Addl CIT with the direction to examine the same afresh by duly considering the explanations and information that may be furnished by the assessee. - Decided in favour of assessee for statistical purposes.
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