2010 (12) TMI 865

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....t. Ltd. and a loan of Rs.9,99,97,540/- from M/s. Panther Ind. Product Ltd., otherwise than by Account Payee Cheque or Draft in violation of Section 269SS. Accordingly, the penalty of Rs.10,26,14,128/- was levied. The assessee's explanation that the aforesaid transaction of loan were not made in cash but through journal entries, and therefore, this did not amount to contravention of provisions of Section 269SS was not accepted by the A.O., who referred to the Joint Parliamentary Committee's report on the Stock Market Scam and held that all these transactions were made with an object to evade tax in various hands. Since the aforesaid transactions of loan were not made through account payee cheque or draft, the Addl. Commissioner held that pen....

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....000 in ITA No.3310/M/04 and for A.Y. 2003-04 in ITA No.537/M/07, the penalty levied under section 271D stood deleted. It was further submitted that in as many as 39 group cases involving identical facts, the penalty levied by the Department under section 271D stood deleted by the ITAT. After considering the explanation of the assessee both on facts and also on legal principles the CIT(A) deleted the penalty by stating as under:-   "3.7 I have carefully perused the ITAT order in the appellant's own case for AY 1999-2000 in ITA No.3310/M/04 and 3311/M/04 dated 16.03.2005 wherein the Tribunal held that penalty cannot be levied when the payments were made or received through journal entries. It would be pertinent to reproduce the releva....

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....ld that no penalty can be levied where the payments are said to be made or received through journal entries."   4. The learned Standing Counsel for the Revenue submitted that the issue is still under consideration of the Hon'ble Bombay High Court and according to the stand of the A.O. the transactions are attracted by the provisions of section 269SS, therefore penalty under section 271D was warranted.   5. The learned counsel for the assessee reiterated the submissions made before the CIT(A) and placed on record copies of the orders of the ITAT in assessee's own case relied upon by the CIT(A). He further placed reliance on the judgement of Hon'ble Delhi High Court in the case of Noida Toll Bridge Co. Ltd. 262 ITR 260 wherein....