TMI Blog2018 (9) TMI 1616X X X X Extracts X X X X X X X X Extracts X X X X ..... on the very same day, the said amount was transferred from the bank account to the Sub–registrar and some other Government Agency towards payment of stamp duty. This fact is also corroborated from the endorsement made in the sale deed executed by the assessee. Thus, prima–facie, it appears that for payment of stamp duty the assessee was compelled to avail the cash loan from the directors looking at the urgency of the matter. there is a reasonable cause for the default or failure on the part of the assessee to comply to the provisions of section 269SS of the Act. That being the case, imposition of penalty under section 271D not justified - Decided in favour of assessee - ITA no.800/Mum./2017 - - - Dated:- 27-6-2018 - Shri Saktijit Dey, Ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The learned Commissioner (Appeals) after considering the submissions of the assessee, though, agreed that no penalty under section 271D of the Act can be imposed against the amount of ₹ 1,00,000 received towards share capital, however, he sustained penalty under section 271D of the Act to the extent of ₹ 3,60,340, representing the loan taken in cash. 4. The learned Counsel for the assessee submitted that the company was incorporated on 29th July 2010 and this is the first year of commencement of business. He submitted, the loan taken was from the two directors of the company. Explaining the reason for availing the loan in cash, the learned Authorised Representative submitted that the assessee was in the process of undert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 71D of the Act, no doubt, makes it clear that acceptance of loan or deposit of cash in contravention of provision contained under section 269SS of the Act would lead to imposition of penalty equaling to the amount of loan or deposit taken or accepted in cash. However, imposition of penalty under section 271D of the Act is neither mandatory nor automatic, as the said provision is subject to the exceptions provided under section 273B of the Act. A reading of section 273B of the Act makes it clear that in a case where the assessee proves that the default or failure in complying to the provision was due to a reasonable cause, no penalty shall be imposable. Thus, it needs to be examined whether in the present case there is reasonable cause for c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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