TMI Blog2021 (10) TMI 967X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee s husband - assessee has explained the payment of construction expenses which are also required to be incurred in cash towards the purchase of construction material and payment to labourers. We therefore find that the assessee has offered reasonable explanation justifying the cash transactions and thus, in the entirety of facts and circumstances of the case and considering various decisions cited at the Bar which also support the case of the assessee especially the decision of the Coordinate Bench in case of Tuhinara Begum [ 2017 (10) TMI 1321 - ITAT KOLKATA] where there was a reverse situation where the wife gave money to husband for construction of house which was held not exigible for levy of penalty u/s 271D, we are of the considered view that the assessee doesn t deserve to be punished by way of levy of penalty u/s 271D for receiving money from her husband for purchase of family property and hence, the same is directed to be deleted. - Decided in favour of assessee. - ITA No. 1201/JP/2019 - - - Dated:- 21-10-2021 - Shri Sandeep Gosain, JM And Shri Vikram Singh Yadav, AM For the Assessee : Sh. Rahul Sanghi (CA) For the Revenue : Smt. Monisha Choudha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quoted case law of Shri Sunil Kumar Sood v/s JCIT (ITAT Delhi) but the ld CIT (A) has not considered the facts and quoted case law of the assessee and rejected the appeal of the assessee. Against the said order and findings of the ld CIT(A), the assessee is in appeal before the Tribunal. 5. It was submitted by the ld A/R that provision of Sec 269SS do not bar genuine cash transactions of loan, but only bar those transactions which are entered with the intention of evade taxes. These provisions are made to counteract evasion of tax but not to bar cash transactions between close relations. It was submitted that the instant case is not the case where unaccounted cash was found in the course of search and seizure operations. The assessee was helped by her husband for acquiring property which one was for the residence of family members. In our case the assessee has not evaded any tax but only purchase a property with the help of her husband for residence of her family members. 6. It was submitted that Section 269SS is applicable to the deposit or loan. There is a relationship of debtor and creditor between the party giving money and the party receiving money in every deposit or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... failure. 8. The Tribunal in its order has found that the genuineness of the deposits made by the assessee's brother Pankaj Sharma was not in doubt by the Assessing Officer. The Tribunal noticed the explanation given by the assessee that the deposits were obtained by him to satisfy the immediate business requirement but found that this has not been established. However, the Tribunal was thus of the view that there was a reasonable cause to accept the deposit otherwise through bank draft or through cheque because the assessee bona fide believed that the cash transactions below ₹ 20,000 was permissible. 9. It is true that the ignorance of law is no excuse, but the question here is whether the assessee was able to establish reasonable cause under Section 273B justifying that no penalty should be imposed in contravention of Section 271D of the Income-tax Act. None of the transactions exceeds, as noticed above, ₹ 20,000. The Tribunal accepted that the assessee bona fide believed that the cash transactions below ₹ 20,000/- was permissible and the cause shown by the assessee constituted reasonable cause. The finding of the Tribunal cannot be said to be gros ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es also for payments to laborers and lenders. Under these circumstances, we are of the view that the transactions being genuine and the assessee having offered reasonable explanation justifying these cash transactions, the impugned penalty u/s 271D is not leviable. Our view is fortified by the judgement of Honble Jurisdictional High Court in the case of CIT vs. Raj Kumar Sharma (supra) and the judgement of Honble Punjab Haryana High Court in the case of CIT vs. Saini Medical Store (supra) which is followed by Honble P H High Court in the case of CIT vs. Sunil Kumar Goel (supra). Thus in view 10 of the facts and circumstances of the case and the decisions relied on above, the penalty is deleted. 11. It was submitted that ITAT Delhi Benches in the case of Shri Sunil Kumar Sood Vs JCIT (ITA No. 1831/Del/2016) that Section 269SS not applies to loan transaction between husband and wife. Further, ITAT Kolkata Benches in the case of Tuhinara Begum Hoogly Vs JCIT Range 2, Hoogly (ITA No. 2256/Kol/2014) has held as under: This was neither a loan nor a deposit. At the same time, the words 'any other person' are obviously a reference to the depositor as per the intention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view the contents of the Departmental Circular No. 387 [1985] 152 ITR (St.) 1), it was never the intention of the Legislature to punish a party involved in a genuine transaction. Therefore, by taking a liberal view in the instant case, the assessee had a reasonable cause within the meaning of section 273D. Thus, keeping in view the entire facts of the instant case, and also keeping in view the intention of the Legislature in enacting the provisions of section 269SS, it was to be held that the assessee was prevented by sufficient cause from receiving the money by an account payee cheque or account payee bank draft. In the instant case, the assessee was of the opinion that the amount in question did not require to be received by an account payee cheque or account payee draft. Thus, there was a reasonable cause and no penalty should have been levied. From the above, it would be clear that the assessee had taken plea that firstly there was no violation of the provisions of section 269SS. Secondly, there was a reasonable cause. Thirdly, the assessee was under the bona fide belief that he was not required to receive the amount otherwise than by an account payee cheque or account payee d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies outside the ground and family of the assessee. The assessee is a separate person and when she takes or accepts loan or deposits from her family members, such other distinct person also comes into picture. One person is giving loan and the assessee, another person, is accepting loan. It, therefore, boils down that two persons are involved in the transaction of accepting loan. To contend that the assessee and her husband are one and the same person is wholly in contravention of the provisions of the Act. 16. It was further submitted that the assessee has nowhere able to demonstrate the urgency to receive loan in cash. It was submitted that the assessee must prove beyond the shadow of the doubt that there existed a reasonable cause for not complying with the conditions contained in section 269SS and in the instant case, no plausible explanation was ever furnished nor the circumstances under which the cash was accepted was explained. It was accordingly submitted that it is a clear case the contravention of provisions of section 269SS of the Act. Thus, penalty u/s 271D of the Act has been rightly levied by the JCIT and confirmed by the ld. CIT(A). It was accordingly submitted tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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