9911796707
TMI Blog2019 (9) TMI 1269X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal dismissed the Assessee's Appeal and upheld the imposition of penalty under Section 271D and 271E of the Income Tax Act 1961 for the alleged violation of Sections 269SS and 269T of the Act. 2. The Findings of the learned Tribunal in this regard are quoted below for ready reference:- "10. In the present case the main crux of the argument of the assessee is that the transactions are genuine and the money was borrowed due to business expediency. The genuineness of the transaction can not be held as a reasonable cause which is clear from the memorandum explaining the provisions in Finance Bill 1984. The words 'reasonable cause' have not been defined under the Act but the same could receive the interpretation which is given ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able and sufficient cause, the authorities shall not levy penalty depending upon the circumstances of each case. In the present case, the assessee is in the business of IMFL and borrowed money for the purpose of bidding the allotment of IMFL shop. The assessee is not new to this business and it is not a single transaction either. Every year the assessee is bidding for allotment of IMFL shop and the Government is giving prior notice regarding the date of bidding. Auction is not conducted by the Government all of a sudden without giving time for the bidders to arrange for funds for paying the allotment money, if allotted. The claim of the assessee is that the transactions are genuine and hence does not fall within the ambit of Section 269SS. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gly the levy of penalty under Section 271E is justified. We uphold the order of Learned Commissioner of Income-tax (Appeals). Accordingly the appeal of the assessee is dismissed." 3. Learned counsel for the Assessee Ms.Sree Lakshmi Valli submitted that similar penalty proceedings were dropped by the Assessing Authority for the preceding Assessment Year viz., Assessment Year 1999-2000, vide communication dated 9.11.2005, wherein after considering the facts of the case and ascertaining the reasonableness which necessitated the acceptance of deposits by cash by the Assessee, the said Additional Commissioner of Income Tax found that it was not a fit case for levy of penalty and therefore, penalty proceedings under Section 271D were dropped a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Assessee and therefore, in view of the said facts and circumstances prevailing in the year 2000-2001 also, the learned Tribunal ought to have taken a similar view as was taken by the original Assessing Authority himself in the preceding year viz., Assessment Year 1999-2000. 4. On the other hand, the learned Senior Standing Counsel Mr.T.R.Senthilkumar appearing for the Revenue supported the impugned order and submitted that the nature of business was very well known to the Assessee and the very fact of dropping the penalty proceedings for the preceding year cannot a ground to set aside the similar penalty proceedings in the next year also and therefore, the order of the learned Tribunal was justified. He relied upon the decision of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion dated 9.11.2005, the learned Tribunal, in our opinion, fell in error in upholding the imposition of penalty by just observing that the Assessee ought not have repeated such a mistake and ought to have done the transaction only through Bank which method, in fact, as the learned counsel for the Assessee submitted, was adopted on 31.8.2001 on which date, the Bank Account was opened by the Assessee and therefore, it is only for this Assessment Year 2000-2001 which stands out and in respect of which the present Appeals are concerned. The law laid down in the decision of Vasan Healthcare (P) Ltd. v. Additional Commissioner of Income-tax, Chennai Range-2, Chennai ((2019) 103 Taxman.com 26 (Madras) is not applicable to the present case as the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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