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2016 (8) TMI 471 - ITAT DELHI

2016 (8) TMI 471 - ITAT DELHI - TMI - Penalty levied u/s 271D and 271E - whether the amount received by the assessee were advances and not loan or deposits ? - CIT(A) delted penalty - Held that:- Commissioner of Income-tax( Appeals) has decided issue in dispute on the basis of the agreements to sale of the inherited property between the assessee and Sh OmPrakash Dhama. He has also mentioned that it was brought on record by the assessee that the agreements could not be executed because of dispute .....

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ce and not as loans or deposit and we uphold the same, accordingly the grounds raised in both the appeals are allowed in favour of assessee - ITA Nos.:-4115, 4116/Del /2012 - Dated:- 22-6-2016 - SHRI H S SIDHU JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER For The Department : Shri Amit Jain, Sr. DR For The Assessee : Shri Vinod Kumar Goel, Adv. ORDER PER O.P. KANT, A. M. These two appeals by the revenue are directed against a common order dated 13/09/2011 of Ld. Commissioner of Income-ta .....

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g the fact that cash loans of ₹ 11,00,000/- and ₹ 2,10,000/- were found in the ledger account of M/s Shah Sons Pvt. Ltd. in the books of the assessee as received on 9.4.2006 and 28/02/2007 respectively in contravention of Section 269SS of the I.T. Act, 1961. 2. Whether in the facts and circumstances of the case, the Ld. Commissioner of Income Tax (Appeals) was justified in law in deleting the penalty of ₹ 13,10,000/- levied u/s 271D of the I.T. Act, 1961, ignoring the fact that .....

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16/Del/2012 1. Whether in the facts and circumstances of the case, the Ld. Commissioner of Income Tax (Appeals) has erred in law and in facts in deleting the penalty of ₹ 13,10,000/- levied u/s 271E of the I.T. Act, 1961, ignoring the fact that re-payment of ₹ 11,00,000/- and ₹ 2,10,000/- were found in the ledger account of M/s Shah Sons Pvt. Ltd. in the books of the assessee as paid on 17/06/2006 and 25/03/2007 respectively in contravention of Section 269T of the I.T. Act, 196 .....

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account and not in business related a/c of party. 3. In the facts and circumstances of the case, the order of the Commissioner of Income-tax (Appeals) may be set aside and that of the Addl. CIT, Range-2, Meerut, restored. 2. In the case, the impugned order of Commissioner of Income tax ( Appeals) was passed on 13/09/2011 and accordingly , the appeals to the Tribunal were required to filed within 60 days of receipt of orders by the Ld. Commissioner of Income-tax, whereas appeals have been filed o .....

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eleted both the penalties vide a single consolidated order dated 13/09/2011. He further submitted that aggrieved by the order of the Ld. Commissioner of Income-tax (Appeals), the revenue filed single appeal for both the penalties on 07/12/2011, however later on being advised by the Senior Departmental Representative that two separate appeals were required to file, immediate measures were taken and these two separate appeals were filed and hence there was a delay of seven months and eight days fr .....

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count of bonafide procedural error as submitted by the learned Senior Departmental Representative, therefore in the interest of natural Justice, we condone the delay in filing the appeal. 5. The facts in brief in the case are that during scrutiny proceedings under section 143 (3) of the Act for the year under consideration ,the Assessing Officer observed from the books of accounts of the assessee that in the ledger account of M/s Shah sons private limited, cash loans of ₹ 11,00,000/- on 09 .....

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Shah sons private limited and it actually belonged to Sh. Om Prakash Dhama son of Sh. Mahender Singh, from whom advance was received on account of sale agreements for inherited house property and the same amount was returned on account of non-materialisation of the deal. The Ld. Counsel of the assessee produced copy of agreement in respect of sale of the inherited property also. According to the Ld. Assessing Officer, it was not possible to make the mistake of name in all the four entries of re .....

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e assessment, the Assessing Officer did not issue summon to the said party and rejected the claim of the assessee of advance against sale of property and held that the assessee was liable for violation of 269SS and 269T of the Act for receipt and payment of loan or deposit in cash as the amounts utilised for business purpose, partakes the character of deposit. The matter was referred to the Additional Commissioner of Income-tax for levy of the penalty, who issued notices on 27/01/2010 proposing .....

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) in view of the agreements to sale of the inherited property held that the amount received by the assessee were advances and not loan or deposits and therefore no penalty under section 269SS or 269T of the Act were attracted in the case of the assessee, and accordingly deleted both the penalties levied by the Additional Commissioner of Income-tax. Aggrieved, the Revenue is in appeal before us raising the grounds are reproduced above. 6. Before us, the Ld. Senior Departmental Representative addr .....

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take was noticed during the course of scrutiny proceedings and accordingly all the evidences were even furnished before the Assessing Officer and the allegations made by the Ld. Senior DR was without any basis or evidences. Accordingly submitted that finding of the Ld. Commissioner of Income-tax (Appeals) might be upheld. 7. We have heard the rival submissions and perused the material on record in respect of the issue in dispute. The Ld. Commissioner of Income-tax( Appeals) has deleted the penal .....

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g loan or deposit or an advance against agreement for sale of land. The appellant, both before the AO and during the appellate proceedings, produced copies of Ekrarnama (Agreements) as under: i. Agreement for sale on 9.4.2006 between Lokesh Kumar (Vendor) & Shri Om Prakash (Vendee) for ₹ 25 lakhs against which ₹ 11 lakhs was given as advance on 9.4.2006. The said agreement stipulated that if full payment was not made by 15.6.2006, the agreement will be cancelled. The agreement wa .....

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