2019 (2) TMI 1367 - AT - Income Tax

Tribunal cancels penalty under IT Act citing reasonable cause & legal precedents

ACIT, Central Circle-6, New Delhi Versus Sahara India Financial Corporation Ltd

The Tribunal upheld the deletion of the penalty under section 271E of the IT Act by the ld CIT(A). The decision was based on the appellant having a ... Penalty u/s 271E - assessee collected certain deposits in cash exceeding ₹ 20,000/- - HELD THAT:- In appellant’s own case for AYs 1993-94, 1999-00, 2000-01, 2001-02, 2002-03, 2003-04, 2004-05 & 2005-06 wherein penalty imposed by Additional CIT has been deleted the on the same issue of levy of penalty u/s 27IE holding the appellant to have reasonable cause as contemplated in Section 273B. The facts of the present case are the same as in earlier years and find no reason to differ with the view taken by my predecessor. - Decided against revenue. Issues: Deletion of penalty u/s 271E of the IT ActAnalysis:1. The appeal filed by the revenue challenges the order of the ld CIT(A) for the Assessment Year 2009-10.2. The revenue raised grounds of appeal questioning the correctness of the ld CIT(A)'s order and the deletion of the penalty u/s 271E of the IT Act.3. The main issue in this appeal is the deletion of the penalty amounting to &8377; 207954176/- imposed by the ld AO under section 271E of the Act.4. The appellant, an RNBC registered with the RBI, collected deposits exceeding &8377; 20,000 in cash, violating sections 269 SS and 269T of the Act, as found during assessment by the ld AO.5. The penalty proceedings were initiated by the ld Add. CIT, and after considering the assessee's reply, a penalty of &8377; 207954716/- was imposed under section 271E of the Act, which was later deleted by the ld CIT(A).6. The ld AR contended that the issue is favorably decided in the assessee's case by the Hon'ble High Court.7. The decision to delete the penalty was based on precedents from earlier years and a ruling by the Hon'ble Delhi High Court, emphasizing reasonable cause as per Section 273B, leading to the exemption from penalty under section 271E.8. The Tribunal, noting the applicability of the Hon'ble High Court's ruling in the assessee's earlier cases, upheld the deletion of the penalty by the ld CIT(A) without finding any fault in the decision.9. Citing legal principles and binding nature of decisions by jurisdictional High Courts and Tribunals, the Tribunal dismissed the revenue's appeal, affirming the deletion of the penalty.Conclusion:The Tribunal upheld the deletion of the penalty u/s 271E of the IT Act by the ld CIT(A) based on the reasoning that the appellant had a reasonable cause as per legal provisions and previous court rulings, leading to the cancellation of the penalty.