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2017 (5) TMI 207 - ITAT HYDERABADPenalty proceedings u/s. 271D - assessee had received loans from various individual- Directors in cash in excess of the limits prescribed u/s. 269SS - Held that:- The company has accepted amounts from the directors and the explanations from the directors was considered in the assessment proceedings and accepted. There is truth in the contention of the assessee that on the same explanation given in the assessment proceeding, the penalty proceedings cannot be initiated. Further, assessee has given a reasonable explanation that the amounts were taken in cash for i) for payment to the court in lieu of directions given by the court to pay the amount in Bengaluru. Assessee in fact has purchased a DD in Andhra Bank Bengaluru and paid to the creditor as per the directions of the court, ii) an amount of ₹ 80,024/- was paid to ICICI Bank for car instalments in small amounts, iii) an amount of ₹ 6,90,000/- was spent for day to day running expenses of the office as the company is having financial difficulties. Further substantial amount was deposit in Bank Account directly. Explanation given was accepted in assessment proceedings, so the same can be considered as reasonable for accepting cash for the purpose of section 271D read with section 273B. Thus it is of the view that the assessee has shown reasonable cause within the meaning of section 273B, therefore, the penalty order is to be set aside. - Decided in favour of assessee.
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