2012 (7) TMI 488

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....act that the assessee failed to establish any reasonable cause for contravention of the provisions of Section 269SS and allowing the contravention of the contravention of the provisions of the said section on irrelevant consideration." 3. Brief facts of the case are that the assessee filed his return of income of 20.11.2006 for the assessment year 2006-07. Reference was made to J.C.I.T., Range-5, Baroda by ITO Ward-5(2) Baroda that the assessee, during the year, had received/accepted loans/deposits exceeding Rs.20,000/- in cash from Shri Ambica Finance in contravention of the provisions of Section 269SS of the Act, details of which are as under:- Sr.No. Date Amount (Rs.) 1 15.05.2005 70,000 2 02.07.2005 70,000 ....

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....e total addition leaving Rs.5,25,000/-. 4. The Assessing Officer has passed order levying the penalty u/s 271 of the Income Tax Act amounting to Rs.11,75,000/- GROUND OF APPEAL Sir, the I earnestly request your majesty for judiciously deleting the penalty levied by the Assessing Officer for the following reasons. First in the instant case, the word 'loans/depsoits' requires to be reassessed for the reason that (A) The transaction is of the nature of cheque discounting/hundi transaction with the shroff. There are series of transaction of cheque discounting and repayment thereof. The meaning of the term loan and deposit has to be looked into with reference to the provisions of the section 269SS and 269TT. The cheques were discount....

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....ubmission: CIT v Balaji traders 167 taxman 27(Mad) CIT v Patana Agencies (Mad) CIT v Saini Medical Store 276 ITR 79 (P&H) CIT v Idhayam Publications Ltd. 163 Taxman 265 (Mad) National Surgical Corp. v CIT 242 ITR 667 (AP) 6. After taking into consideration the submissions of the assessee, ld. CIT(A) deleted this penalty. Aggrieved by this order of ld. CIT(A) now the Revenue is in appeal before us. 7. At the time of hearing ld. DR relied on the order of the A.O. however, none appeared on behalf of the assessee despite notice being served upon him for today's hearing. 8. After hearing ld. DR and perusing the record, we find that ld. CIT(A) has given relief to the assessee in view of the fact that the transactions with ....