TMI Blog2021 (10) TMI 1208X X X X Extracts X X X X X X X X Extracts X X X X ..... ash for personal purpose between near relatives do not attract the provisions of sec.269AA and 269T. Hon ble Madras High Court held that receipt of cash by the daughter-in-law from father-in-law does not attract the provisions of sec. 269SS of the Act. Similarly in SRI MANSUR ALI LASKAR [ 2011 (12) TMI 732 - ITAT KOLKATA] wherein, it was held that niece, uncle, aunty, wife of brother, wife s sister and cousin are part of family members and the transactions with sister-in-law and nephew should also to be considered as a transaction between family members - Decided against revenue. - ITA Nos.1220 & 1222/Bang/2016 And ITA Nos.2355 & 2356/Bang/2018 - - - Dated:- 27-10-2021 - Shri N.V. Vasudevan, Vice President And Shri B.R Baskaran, Accountant Member For the Appellant : Shri. Amrit Raj Singh, JCIT, (DR)(ITAT), Bengaluru For the Respondent : Shri. V Srinivasan, Advocate ORDER PER BENCH : These are appeals filed by the Revenue against the common order dated 23/3/2016 of CIT(A)-1, Bengaluru relating to asst. years 2006-07 and 2008-09, insofar as it relates to imposition of penalty u/s 271D of the Act and 2006-07 and 2007-08, insofar as it relates to imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the source of Dr. P Dayananda Pai has been explained by Dr. P Dayananda Pai in his letter dated 21/2/2013 and 26/3/2013 filed before the Department and that the cash transactions were genuine. It was the plea of the assessee that the receipt of money by the assessee and its repayment cannot be characterized as loan and, therefore, provisions of sec.269SS and 269T will not stand attracted. It was submitted that loans between near relatives in cash do not attract provisions of sec.269SS 269T of the Act. The confirmation of Dr. P Dayananda Pai was also filed before the Revenue authorities and it was pleaded that monies were given purely out of family sentiments and keeping in mind that the assessee has lost his father. Dr. P Dayananda Pai being the uncle, given the money to the assessee. 6. The officer imposing penalty was however, not satisfied with the aforesaid explanation offered by the assessee. He held that there is a violation of sec. 269SS and 269T of the Act as loans were taken in cash in excess of ₹ 20,000/- and were repaid in cash in excess of ₹ 20,000/-. The AO also held that there was no reasonable cause for violation of provisions of sec. 269SS and 269 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e treated as appeals challenging levy of penalty u/s 271D of the Act and the Department was directed to file separate appeals insofar as challenge to the imposition of penalty u/s 271E of the Act. 11. Pursuant to the aforesaid directions, the Revenue s plea in ITA Nos.2355 and 2356/Bang/2018 that there is a delay of 590 days in filing these 2 appeals. The reason for delay has been explained in an Affidavit filed on behalf of the Revenue by citing the following reasons in filing the appeals. I, Shri Deepak G. , S/o Shri K Gopalaswamy , Major (28 Yrs.) presently at 4th Floor, BMTC Building, 6th Block, Koramangala, Bengaluru - 560 095 do hereby solemnly affirm and state on oath as follows: 1. I am working in Income Tax Department in aforementioned post. I am authorized to swear to this affidavit on behalf of the appellants. I am fully conversant with the facts of the case. 2. It is submitted that the impugned order passed by the Ld. CIT(Appeal)-1 was received by the Appellant's office viz, Commissioner of Income Tax, Bangalore on 02.05.2016 and the same was forwarded to the concerned assessing authority for scrutiny. The said officer after receiving the same prep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is mainly stated that the payments and receipts by way of cash are purely on account of personal transaction. However, it is worthwhile to note that Shri. Dayananda Pai has stated that the payments were made by him out of his Imprest Account in Canara Housing Development Company. The name and style of the Imprest Account is explained as Dayananda Pai P. Current A/c for the period from 01/04/2005 to 31/03/2007 totalling to ₹ 1,70,00,000/- Miscellaneous Properly Advances Partners Imprest for the period from 01/04/2007 to 31/03/2008 totalling to Rs:18,00,00,000/-. It is further stated that all the amounts and Heads of Accounts mentioned above are from Finalized Audited Accounts for the respective year of Canara Housing Development Company. In effect, it is stated that the transactions of cash payments and cash receipts between Shri. Dayananda Pai and the assessee Shri. Sanjay Shenoy are accounted for in the books of accounts relating to business, - maintained by the business entity of which Shri Dayananda Pai is the Managing Partner. In the circumstances, it is clear that the cash payments and cash receipts by Shri. Dayananda Pai to the assessee Shri. Sanjay Shenoy are n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e placed reliance on several decisions and in particular placed reliance on the decision of ITAT Kolkatta Bench in the case of Jagmohan Sharma Vs. JCIT in ITA Nos.552 553/Kol/2015 dated 10/1/2018. He pointed out that in the aforesaid decision, payment and repayment of monies between niece, uncle and aunt were held to be outside the purview of provisions of sec.269SS and 269T of the Act. The following observations of the Tribunal were brought to our notice. 8. We have given a careful consideration to the rival submissions and perused the material available on record, we note that Coordinate Bench of the Kolkata Tribunal in the case of Sri Mansur Ali Laskar in ITA No.1094/Kol/2011 for A.Y 2007-08 dated 30.12.2011 (supra) wherein the Bench has considered, Niece, Uncle, Aunty, Wife of brother, Wife's Sister and Counsin sister as a part of family members. In the assessee's case under consideration the transaction with sister-in- law and Nephew should also be considered as a part of family members. There is no difference between Wife's sister and Sister-in law and if Niece is part of family member then Nephew should also be part of family member. We note that Judgm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of sec.269AA and 269T of the Act. 17. In the case of CIT Vs. Smt. M Yesodha, 351 ITR 265, an amount received by assessee from her father-in-law was held to be outside the ambit of sec. 269SS of the Act. In the case of Ms. Nanda Kumari Vs. ITO, Tax case appeal No.968 of 2018 and judgment dated 20/12/2018 wherein, the Hon ble Madras High Court held that receipt of cash by the daughter-in-law from father-in-law does not attract the provisions of sec. 269SS of the Act. Similarly, the Hon ble Kolkatta High Court in ITA No.111 of 2012, GA No.1498 of 2012 approved the view of the ITAT Kolkata Bench in the case of Shri Mansur Ali Laskar in ITA No.1094/Kol/2011 dated 30/12/2011 wherein, it was held that niece, uncle, aunty, wife of brother, wife s sister and cousin are part of family members and the transactions with sister-inlaw and nephew should also to be considered as a transaction between family members. In the light of the aforesaid decisions, we are of the view that the CIT(A) was justified in canceling the penalty imposed by the AO. Consequently, all these appeals are dismissed. 18. In the result, the appeals by the Revenue are dismissed. Pronounced in the open court on the ..... 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