TMI Blog2020 (1) TMI 1048X X X X Extracts X X X X X X X X Extracts X X X X ..... e paper book support assessee's claim. Judicial precedents cited before us have also laid down the ratio that cash loan received from partner would not attract the provisions of section 269SS and section 271D of the Act since a Firm and Partner are not to be considered as different entities. Assessee with a bona fide belief that the provisions of section 269SS are not applicable has availed the cash loan from the partner. Further, Section 273B which also covers section 271D makes it clear that if the failure to comply to the relevant provision is due to reasonable cause, no penalty should be imposed. We are of the considered opinion that the assessee has made out a case of reasonable cause for availing cash loan from the partner, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to ₹ 11 lakh in violation of section 269SS of the Act. In response to the show cause notice issued, the assessee, vide its reply dated 1st June 2015 submitted that the cash loan was availed from one of the partners. Referring to the definition of Firm and Partner , as per section 2(23) of the Indian Partnership Act, 1932, it was submitted, though, under the Income Tax Act, 1961, a Firm and Partner are considered to be separate taxable entities, however, as per the general law, they are not considered to be separate and distinct entities. Rather, they are considered to be carrying on business jointly. It was submitted by the assessee, it had a bona fide belief that the firm not being a legal entity, the provisions of section 269 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash loan. Hence, imposition of penalty under section 271D of the Act is not justified. To demonstrate the aforesaid fact, the learned Authorised Representative drew our attention to the ledger account copy of the concerned creditor placed at Page-53 and 54 of the paper book. Thus, he submitted, the penalty imposed should be deleted. In support of his contention, the learned Authorised Representative relied upon the following decisions:- (i) CIT v. Muthoot Financiers [2015] 371 ITR 408 (Del.); (ii) CIT v. V. Sivakumar, [2013] 354 ITR 9 Mad.); (iii) CIT v. Lokhpat Film Exchange (Cinema), [2008] 304 ITR 172 (Raj.); (iv) CIT v. Ajitnath Hi-Tech Builders (P.) Ltd., [2019] 412 ITR 316 (Bom.); and (v) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atio that cash loan received from partner would not attract the provisions of section 269SS and section 271D of the Act since a Firm and Partner are not to be considered as different entities. Keeping in perspective the relevant facts and the ratio laid down in the judicial precedents cited before us, it can be said that the assessee with a bona fide belief that the provisions of section 269SS of the Act are not applicable has availed the cash loan from the partner. Further, Section 273B of the Act, which also covers section 271D of the Act, makes it clear that if the failure to comply to the relevant provision is due to reasonable cause, no penalty should be imposed. Keeping in view the overall facts and circumstances of the case, we a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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