TMI Blog2011 (4) TMI 1157X X X X Extracts X X X X X X X X Extracts X X X X ..... J. JUDGMENT Mrs. Chitra Venkataraman J.- 1. The assessee has come up on appeal as against the order of the Income-tax Appellate Tribunal, Chennai "A", Bench dated January 14, 2004, in I. T. A. No. 787/Mds/1996 raising the following substantial questions of law : "1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in confirming the levy of penalty under section 271D of the Act especially in the context of the finding that there was no reasonable cause was not based on any material before it ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in not deleting the penalty in the light of the Supreme Court's decision reported in Asst. Direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee succeeded before the Commissioner of Income-tax (Appeals), who accepted the case of the assessee/appellant herein that the amounts were taken on requirement of liquidity position and the peculiar nature of trade of the assessee-company and allowed the appeal. 3. Aggrieved by the same, the Revenue went on appeal before the Tribunal. The assessee contended that the cheques in favour of the appellant-company was given to the financier, who got them discounted and paid the money in cash to the assessee. For this, the assessee had issued post-dated cheques to the financier assuring repayment. The Tribunal referred to the decision of the apex court in the case of Asst. Director of Inspection (Investigation) v. Kum. A. B. Shanthi [2002] 255 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions of section 269SS and the assessee taking a loan by cash, penalty equal to the sum of the amount of loan so taken or accepted and would be leviable under section 271D. However, section 273B of the Act states that under section 271D, penalty would not be leviable only if and when the assessee shows a reasonable cause for any such failure to adhere to the provisions of section 269SS. Applying section 273B to the case, we find that except for mere statement that the receipt of amount in cash was on account of the business exigency and to meet the liquidity, there is hardly any material to show that in fact there was a real exigency that compelled the assessee to go for cash loan. 7. The Assessing Officer found that there were 72 item ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s court shows that as against the cancellation of levy of penalty, the Revenue came up on appeal before this court. Following the decision of this court in CIT v. Ratna Agencies [2006] 284 ITR 609 (Mad), this court rejected the Revenue's appeal at the admission stage itself holding that having regard to the pure finding of fact on the reasonable show-cause shown by the assessee for cancelling the penalty, no question of law, much less a substantial question of law arose for interference. Even extending the said decision to the facts herein, it is seen that the Tribunal found, as a matter of fact, that the assessee had not shown any reasonable cause for taking cash loan. As regards the first of the item of Rs. 85,000 as representing an openi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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