TaxTMI 
TaxTMI 
2015 (2) TMI 362
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....M/s. Yellaiah Gupta Transport and Rs. 24,000 to Smt. D. Sarada Mohan, through cash. 2. The appellant submitted its explanation stating that it was only a book adjustment to the sister concern, M/s. Yellaiah Gupta Transport, and no cash was paid. As regards the payment to Smt. Sarada Mohan, it was stated that her husband was the legal advisor, and with a view to help her, on account of bereavement due to his death the amount was paid. 3. In respect of the assessment year 1993-94, it was alleged that Rs. 1,99,573 was paid to M/s. Yellaiah Gupta Transport in contravention of section 269T and a sum of Rs. 1,23,000 was received from the said firm in contravention of section 269SS of the Act. Notices, referable to sections 271E and 271D, respectively, were issued. Explanations were also submitted. 4. The Assessing Officer passed three separate orders dated March 27, 1997, levying penalty as proposed through the show-cause notices. Aggrieved by the said order, the appellant filed three appeals before the Commissioner of Income-tax (Appeals)-I, Hyderabad. The appeals were rejected through separate orders dated December 9, 1997. Thereupon, the appellant filed I. T. A. Nos. 151 to 153/HYD....
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....ala reported in [2001] 252 ITR 1 (SC) has impliedly overruled the decision of the High Court in ITO v. Laxmi Enterprises reported in [1990] 185 ITR 595 (AP) is correct ?" 5. Sri Y. Ratnakar, learned counsel for the appellant, submit that certain cash adjustments had to be made, between the appellant and its sister concerns, particularly in view of the dissolution of the firm, M/s. Venkateshwara Rice Mill, and the Assessing Officer himself did not find fault with such adjustment, when he passed orders under section 143(3) of the Act. He contends that the very fact that proceedings were initiated under section 271E, on the one hand, and section 271D, on the other hand, in relation to the same agencies, discloses that the so-called payment and receipt was nothing, but a book adjustment. He further submits that payment of small amount to the widow of the counsel was treated as a violation of section 269T of the Act and penalty was imposed. Learned counsel submits that none of the authorities have taken into account the mandate under section 273B of the Act and the penalty was imposed indiscriminately. 6. Sri S. R. Ashok, learned senior counsel for the respondent, on the other hand, s....
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....e, 1984, take or accept from any other person (hereafter in this section referred to as the depositor), any loan or deposit otherwise than by an account payee cheque or account payee bank draft if- (a) the amount of such loan or deposit or the aggregate amount of such loan and deposit ; or (b) on the date of taking or accepting such loan or deposit, any loan or deposit taken or accepted earlier by such person from the depositor is remaining unpaid (whether repayment has fallen due or not), the amount or the aggregate amount remaining unpaid ; or (c) the amount or the aggregate amount referred to in clause (a) together with the amount or the aggregate amount referred to in clause (b), twenty thousand rupees or more." 10. Section 271D prohibits a company or co-operative society from repaying to any person, any deposit, otherwise than through account payee cheque or account payee bank draft, if the amount exceeds Rs. 10,000. Here again, certain exceptions are provided. Penal provisions corresponding to section 269SS and section 269T are sections 271D and 271E. They read as under : 271D. Penalty for failure t....
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....egation contained in the show-cause notices, the Assessing Officer did not indicate the method of payment. It was simply mentioned that everything was done in cash. The very fact that from the same agencies, amounts were said to have been received and repaid, as reflected in the books, discloses that it was nothing but book adjustment. Further, he did not give any specific finding that the so-called receipts are in the form of loan or deposit or the repayment was made thereof. All the three orders passed by the Assessing Officer are silent about the payment made to Smt. Sarada Mohan. The Appellate Commissioner as well as the Tribunal proceeded on the same lines. They did not bestow any attention as to whether one of the sister concerns can take deposit, or loan, from another, without reflecting the same in the books of account. The proceedings initiated under sections 271D and 271E were treated almost in the ordinary sense. 14. Obviously, anticipating that instances of indiscriminate invocation of sections 271D and 271E and other analogous provisions may take place, Parliament introduced section 273B. It reads. &n....