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TMI Blog2021 (10) TMI 1208X X X X Extracts X X X X X X X X Extracts X X X X ..... or the asst. year 2007-08 and Rs. 2,88,50,000/- for the asst. year 2006-07 to Dr. P Dayananda Pai. All the aforesaid receipts and payments were in cash. As per the provisions of sec.269SS of the Act, no person shall accept from any other person any loan otherwise than by an account payee cheque where the sum of loan so taken is in excess of Rs. 20,000/-. Similarly, sec. 269T of the Act provides that no person shall repay any loan otherwise than by account payee cheque, where the loan repaid is in excess of Rs. 20,000/- u/s 271D of the Act. If there is a violations of sec. 269SS of the Act, the person so violating , shall be liable to pay penalty equal to the loan accepted in cash u/s 271E of the Act. Repayment of deposit in cash attracts the penalty in the hands of the person so repaid a sum equal to the sum of loan repaid in cash. 3. The proceedings u/s 271D and 271E of the Act were initiated against the assessee for taking loan in cash and repaying the loan in cash as mentioned above. 4. Under the provisions of sec. 273D of the Act, no penalty u/s 271D or 271E of the Act will be levied if the person against whom such proceedings are initiated proves that there is a reasonable c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1995) 52 ITD 236 wherein, it was held that transactions which were personal in nature do not attract provisions of secs.269SS and 269T of the Act. 8. The CIT(A) after considering the above submissions agreed with the submissions and cancelled penalties imposed on the assessee u/s 271D and 271E of the Act observing as follows: "The appellant is nephew of Dr. P.Dayananda Pal, after the death of his father this family transaction is between the two. Dr. P.Dayananda Pai has confirmed the transactions, stating that "I would also Like to mention that with respect to Para A reasons mentioned above, it is nothing but the monies received back from Sri Sanjay Shenoy which was given by me earlier, as explained to your good self in Point number 3,4, 5 supra above. These monies were give to him to purchase flat for his personal use as a maternal uncle to support him in his initial years of Life tl settle down after the demise of his father (i.e., my brother-in-Law - own sister's husband)" "I can also come personally and give statement in support of the confirmation letter given by me now. The transactions mentioned above are purely my personal transactions and it is not a loan or bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on from honourable ITAT, separate papers for individual assessment years are being filed now. In the aforesaid process, there is delay in filing the above appeal. The same is bonafide as the same was due to delay in correspondence and due to the aforesaid process. Hence, the appellants prays this Hon'ble Court to condone the delay in filing of the aforesaid appeal and if the same is not entertained, the appellant would be put to great hardship and on the other side no hardship would be caused to the other side. WHEREFORE, the appellant prays this Hon'ble Court be pleased to condone the delay in filing the above appeal in the interest of justice and equity. " 12. We have heard the submissions of the ld.DR on the application for condonation of delay and are satisfied that the delay in filing the appeals is owing to reasonable cause and is purely technical. Hence, the same is condoned. As per the merits of the appeals filed by the Revenue is concerned, the principal contention of the department is that the assessee was also in the business of real estate and his uncle Dr. P Dayananda Pai was also in the business of real estate. It is the stand of the department that these w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is only that the said transactions are being colored as 'Personal Transactions' and named as monies given and monies taken, owing to the fact that there exists a personal relationship of Uncle and Nephew between Shri. Dayananda Pai and the assessee, Shri. Sanjay Shenoy. in view of the above findings, the cash transactions between the assessee Shri Sanjay Shenoy and Shri Dayananda Pai are treated as loans received and loans repaid." 14. He pointed out that the source of cash of Dr. P Dayananda Pai was from the imprest account of a firm in which, he was a Managing Partner and that by itself cannot be conclusive to hold that the cash payments were in the nature of business transactions and it was not personal in nature. He brought to our notice that Dr. P Dayananda Pai in a letter dated 21/2/2013 addressed to the AO wherein, he has narrated the entire sequence of the events as affirmed that monies were given by him to his nephew to enable him to purchase a flat for his personal use as a maternal uncle to support him in his initial years of life to settle down after the demise of his father i.e Dr. P Dayananda Pai own sister's husband. He also brought to our notice that in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for example medical help, education help and expenses to run the family. That is, one member of the family helps to other member in ti needy hours, such as during medical treatment, education, marriage some other family needs. Therefore, respectfully following the judgrn1 the Coordinate Bench, we are of the view that transaction between Sister-in-law and Nephew(family members) did not fall in the definition of loan. Therefore, penalty for accepting loan and repaying loan u/s 271D and 271E should not be levied. Therefore, we quash the penalty u/s 271D and 271E for the AN 2005-06 in ITA No.552/Kol/201 5 and in ITA No.553/Kol/2015." 15. It was submitted that in the light of the aforesaid decisions and in the light of the factual position that the loans in question were personal in nature, the penalty imposed was rightly cancelled by the CIT(A). 16. We have given a careful consideration of the rival submissions. The material in record clearly goes to show that the assessee as well as Dr. P Dayananda Pai who were admittedly nephew and uncle and confirmed that the loans were personal loans to enable the assessee to purchase a flat. The source of cash has also been explained by Dr. P D ..... X X X X Extracts X X X X X X X X Extracts X X X X
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