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2023 (1) TMI 125 - AT - Income TaxPenalty levied u/s. 271D - exigency of contravention of provisions of 269SS as the fact of each transaction need independent verification - assessee has not shown the reasonable cause w/s. 273B for entering into such transactions through journal entries - HELD THAT:- We note that the CIT(A) has granted relief to the Assessee by following the judgment of the Hon’ble Bombay High Court [2018 (2) TMI 603 - BOMBAY HIGH COURT] rendered in identical facts and circumstances and deciding identical issue in favour of the Assessee. Following the judgment of the Hon’ble Bombay High Court, we uphold the order of CIT(A) deleting penalty u/s 271D of the Act in respect of loans/advances received by the Assessee through journal entry. The deposits/loans received by the Assessee through journal entries though hit by Section 269SS would not result in levy of penalty since the transactions were undertaken by the assessee prior to the decision in the case of Triumph International Finance [2012 (6) TMI 358 - BOMBAY HIGH COURT] as the assessee shall be deemed to have had reasonable cause to receive the deposits/loans through journal entries on account of various judgments/orders holding that journal entries in the book of accounts indicating deposit/loans did not fall foul of Section 269SS of the Act, which would also be a reasonable cause under Section 273B of the Act for non-imposition of penalty under Section 271D of the Act. Accordingly, all the grounds raised by revenue are rejected.
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