TaxTMI 
TaxTMI 
TaxTMI 
2014 (2) TMI 564
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....activity. During the previous year relevant to assessment year 20062007, the assessee had paid a sum of Rs.13,91,330/to 25 different parties. Such amounts were in excess of Rs.20,000/at a time and were not made through cheques. Assessing Officer therefore, believed that the payments were hit by section 269T of the Income Tax Act, 1961 and resultantly, the assessee was liable to penalty under section 271E of the Act. 3. The case of the assessee was that such amounts were received from the said 25 parties for booking of the shop/office/flat which they later on cancelled. Such amounts therefore, had to be returned. In short, the assessee's case was that such amounts were neither loans nor deposits and therefore, section 269T of the Act would not be applicable. 4. The Assessing Officer did not accept the contention and imposed penalty which was challenged before the CIT(Appeals) by the assessee. CIT(Appeals) deleted the penalty observing interalia that the parties in question were refunded the advance money without interest because of various reasons. Section 269SS would be applicable where loan or deposit has been accepted or repaid otherwise than by Account payee cheques. The custo....
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....ssessee had accepted the advance money in cash in excess of Rs. 20,000/which was in the knowledge of A.O. but AO had applied the provisions of sec.271D of the Act. He has further held that there is no ban in the Act against accepting cash for sale of an immoveable asset. In the present case, the advance is for purchase of shop/premises which is accepted asset. CIT(A) has further observed that AO had not commented on the detailed submissions filed before him during the course of penalty proceedings and and without appreciating the full facts AO has levied penalty only for the reason that the refunds were made by the cheques. Nothing has been brought on record by Revenue to controvert the findings of CIT(A) further the cases law relied by the Reevenue are also distinguishable on facts. 12. In the case of Shiv Enterprises (ITA No.291/Ahd/2009 order dated 14102011) the coordinate Bench relying on the CBDT circular no.387 dated 06071984 held receiving advance and repayment of advances is a business transaction. Provisions of Sec.269SS is confined to loans and deposits only and does not extend to purchase/sale transaction." 6. Learned counsel for the Revenue would place heavy reliance ....
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....rce of deposit, capacity of the depositors etc. are wholly irrelevant so far as the applicability of Section 269T is concerned. No evidence could be referred or pointed out which has been omitted to be considered by the Tribunal in holding that the said deposit is not a trade advance. The finding of the Tribunal holding that the deposit in question is not a trade deposit is basically a finding of fact and was rightly arrived at by it. We therefore decides the said question against the assessee and in favour of the Department." 7. On the other hand learned counsel Ms. Vaibhavi Parikh drew our attention to an order dated 4.4.2011 passed in Tax Appeal No.2074/2009 in case of Commissioner of Income tax v. Top Media Entertainment ltd. in which the Court had confirmed the decision of the tribunal deleting the penalty under section 271E in somewhat similar circumstances. 8. From the record it emerges that it is undisputed that the respondent had in the course of business of construction, accepted from various parties earnest money for booking shop/office/flat. Some of these advances were also through cheques. Some of the parties cancelled the advance booking due to various reasons. On a....
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....based on valid materials and evidence. The relevant provisions of law are sections 269T, 271D, 271E and 273B of the Act. In the present case, the Assessing Officer levied penalty under section 271E deals with "penalty for failure to comply with the provisions of section 269T". Section 271E, as on the relevant period, reads as follows: "271E. (1) If a person repays any deposit referred to in section 269T otherwise than in accordance with the provisions of that section, he shall be liable to pay, by way of penalty, a sum equal to the amount of the deposit so repaid. (2) Any penalty imposable under subsection (1) shall be imposed by the Deputy Commissioner." 9. The above section provides that no branch of a banking company, cooperative bank and no other company or cooperative society or partnership firm or other person, can repay any deposit made with such entity otherwise than by an account payee cheque or an account payee draft drawn in the name of the person who has made the deposit. The specific word used in the provision is "deposit". In this case, the finding is that there is no deposit. Section 273B of the Act deals with "penalty not to be imposed in certain cases". Section ....