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M/s. Shiv Sharan Trading Pvt. Ltd. Versus ACIT-Range-4 (3) , Mumbai

2016 (8) TMI 655 - ITAT MUMBAI

Levy of penalty u/s. 271D - accepting cash loan - Held that:- In the case under appeal the assessee had taken loan from one of its share holder and that share holder had withdrawn the money from its bank account. Thus, there was no introduction of cash on part of the shareholder. The assessee had to make the EMI payment and for that purpose it had taken a cash loan. In our opinion, it can be considered a reasonable cause looking in to the facts and circumstances. Section 269SS were introduced wi .....

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ial Member Revenue by : Shri N. Sathya Moorthy-DR Assessee by : Shri Atul Mehta ORDER Per Rajendra, AM Challenging the order dated 03. 01. 2013 of the CIT(A)-8, Mumbai, the assessee has filed the present appeal for the above mentioned assessment year. Assessee is engaged in renting out of various commercial properties. The Return of income was processed on 23-07-2009. Assessment u/s. 143 (3)r. w. s. 147 of the Act, was completed on 30. 09. 2011, assessing its income at ₹ 7, 31, 501/-. 2. S .....

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e of ₹ 2, 90, 521/-for the said month was presented in the bank account, there was balance of ₹ 2, 27, 494. 28 was only available in the account of the assessee. In view of the same, the Assessee Company took a cash loan of ₹ 85, 000/- from Mohan B. Motwani HUF, a shareholder of the company. As per the assessee the said cash loan was taken by the Company to tide over the crisis and to avoid default in the payment of EMI so as to avoid late payment interest and also penalty. It .....

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to safeguard its credit rating, that the transaction was between the share -holder and the company, that while carrying out the transaction the accountant was unaware of the provisions of section 269SS. However. the AO did not accept the submission made by the assessee and held that it had clearly contravened the provisions of section 269SS of the Act, that ignorance of law was not an excuse for contravening the provisions of the section, that the credit -worthiness of the assessee was not at st .....

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s and avoid defaulting loan instalment/late payment charges and penalty, that any default in loan instalment would have also dented the credit of the assessee and would have impacted its business prospects, that the cash loan was taken from the shareholder of the company who is regularly assessed to tax. The assessee relied upon certain case laws. After considering assumption of the assessee and the penalty order, the FAA held that the assessee had taken loan in cash of ₹ 85, 000/-, that i .....

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not the case of the assessee that it was required to pay unforeseen payments which it could not visualise, that it could not take the advantage of the circumstances which were of its own creation. Finally, he upheld the penalty levied by the AO. 4. During the course of hearing before us, the Authorised Representative(AR) argued that loan was taken from shareholder due to compelling circumstances, that it was a solitary transaction, that it was not aware that certain provisions of law would be v .....

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umph International Finance (I) Ltd. (345ITR270); Smt. Dimpal yadav Income tax appeal No. 174 of 2015 dated 21. 8. 2015;Lodha Builders Pvt. Ltd. (ITA476/M/14 dated 27. 06. 2014;M/s. Shreepati Developers & Builder Ltd. (ITA No. 7197 & 7198/M/2014, dt. 15. 04. 2015;Zodiac Developers Pvt. Ltd. (ITA No. 31/M/2011 dt. 10. 10. 2014); Sanju Kothari (ITA No. 3790/M/2013 dt. 04. 3. 2016); M/s. R. K. & Co. Pvt. Ltd. (ITA 2218/M/12 dt. 31. 7. 2013); Mrs. Rupali R. Desai (088ITD76);Bhagwati Prasa .....

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