TaxTMI 
TaxTMI 
2000 (6) TMI 158
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....ernment. There was a search and seizure action on the premises of the assessee from 21-8-1995 to 22-8-1995. Various incriminating documents and records were seized by the department during the course of search and, accordingly, the Assessing Officer passed the assessment order on 24-8-1996 for the Block period 1-4-1985 to 21-8-1995 under section 158BC read with section 143(3) of the Act. While scrutinising the seized documents in the course of assessment proceedings for the Block period, the Assessing Officer observed that the assessee had repaid loans/deposits in excess of Rs. 20,000 by otherwise than account-payee cheques/demand draft. According to the Assessing Officer, the assessee had contravened the provisions of section 269T read wit....
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....nbsp; Rs. 6,52,600 1995-96 Rs. 16,49,013 1996-97 Rs. 4,17,400 --------------------------------------------------------------------- 3. The assessee appealed to the CIT(A). The CIT(A) observe....
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....e drew our attention to the statement of the assessee recorded under section 132(4) placed in the compilation at pages 42 to 45 and submitted that the assessee has all along contended that he has raised loans. He submitted that there is a distinction between the expression 'loan' and 'deposit'. For this, he relied upon the Commentary by Chaturvedi & Pithisaria on page 5735 (Vol. V, 4th Edn.). According to the learned counsel, the interpretation of section 273E put by the learned CIT(A) that it applies only to the cases of 'deposit' and not to 'loans' is correct and accordingly, the orders of the CIT(A) deserve to be upheld. 6. We have considered the rival submissions and perused the facts on record. A plain perusal of the provisions of s....
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....omarily accepts deposits. Deposits could also be for safe-keeping or as a security for the performance of an obligation undertaken by the depositor. In the case of a loan, however, it is the borrower at whose instance and for whose needs the money is advanced. The borrowing is primarily for the benefit of the borrower although the person who lends the money may also stand to gain thereby by earning interest on the amount lent. Ordinarily, though not always, in the case of a deposit, it is the depositor who is the prime mover while in the case of a loan, it is the borrower who is the prime mover. The other and more important distinction is in relation to the obligation to return the money so received. In the case of a deposit which is payabl....
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....ding loans taken by him from various parties. The question No. 4 is also in regard to the records maintained by the assessee in regard to these loans. Subsequent questions also are in regard to the advances received and interest paid by the assessee on the same. The statement of one of the creditors, Shri Vishnu L. Patil (page 23 of the paper book) was also perused by us. He was also asked regarding the loans obtained by the assessee from him. In short, the department's case has always been that the assessee has borrowed different sums of money by way of loans in different years from 1990-91 to 1996-97 in contravention of section 269SS. Accordingly, what the assessee repaid were loans and not deposits and therefore, provisions of section 27....