AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2014 (5) TMI 1052
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....alments. Once the repayments of ten instalments are over, again the same persons took further loan. He charged interest on the loan at one percent per month. The whole transaction was done by cash only i.e. no cheques or drafts came into play. The ITO has found during the survey proceedings that the assessee had violated the provisions of both the sections 269SS and 269T of the Income Tax Act as the assessee had accepted the loans in cash exceeding Rs. 20,000/- and repaid the loan exceeding Rs. 20,000/-. The details of loans obtained and repaid by the assessee are as under: Assessment year 2008-09: Cash loan: 21.06.2007 15 lakhs Cash repayment Rs. 15 lakhs Assessment year 2009-10: Cash loan: 23.04.2008 20 lakhs Cash repayment Rs. 20 lakhs 07.03.2009 20 lakhs Assessment year 2010-11: Cash loan: 09.01.2010 20 lakhs Cash repayment Rs. 20 lakhs Assessment year 2011-12 Cash loan: 03.11.2010 20 lakhs Cash repayment Rs. 23 lakhs Assessment year: 2012-13 Cash repayment Rs. 13 lakhs The ITO has referred this case to the JCIT, Puducherry and consequent to the above reference, a show cause notice dated 16.12.2011 were issued to the assessee under section 27....
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....reasonable cause for accepting loans in cash and section 269SS of the Act has been deliberately violated by the assessee for which penalty attracts under section 271D of the Act and accordingly, the Assessing Officer imposed penalty under section 271D of the Act. 4. The assessee carried the matter in appeal before the ld. CIT(Appeals). The ld. CIT(Appeals) issued notice to the assessee and duly served upon the assessee on several dates repeatedly from 01.04.2013 to 25.11.2013. 1st notice of hearing was fixed by the ld. CIT(Appeals) on 30.04.2013 and another five hearing notices were issued by the ld. CIT(Appeals) fixing hearing on 05.08.2013, 10.09.2013, 09.10.2013, 19.11.2013 and 17.12.2013. However, none appeared on behalf of the assessee. On 07.08.2013, Shri Jayachander, C.A. attended and sought for adjournment of the case, which was fixed on 13.08.2013 to file further details. Even on this date, the AR of the assessee has failed to attend before the ld. CIT(Appeals). Therefore, the ld. CIT(Appeals) proceeded to decide the appeal on ex-parte and confirmed the order passed by the Assessing Officer by passing a detailed order, which is reproduced as under: "5. Decision and g....
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....igned by the appellant to prove that the transactions are genuine and bonafide. Even the genuine and bonafide transactions are covered under the provisions of Sec.269SS of the IT Act. The insistence of the lender on transacting of the loan in cash cannot be treated as reasonable cause for violation of the provisions of Sec.269SS of the IT Act in the hands of the appellant. The repeated acts of the acceptance of the loan in cash on the insistence of the lender amounts to active promotion of the violation of Sec.269SS of the IT Act by the appellant. I am also convinced that the appellant has no reasonable cause for acceptance of the loan in cash in contravention of the Sec.269SS of the IT Act, 1961. The ratio of the various decisions of the Courts relied upon by the AO while levying penalty are squarely applicable to the facts of the case. Therefore, all the grounds of appeal filed by the appellant are rejected. Under the facts and circumstances of the case, I am of the confirmed view that Joint Commissioner of Income Tax has rightly levied penalty u/s 271D of the IT Act of Rs. 15,00,000/-." 5. On being aggrieved, the assessee is in appeal before the Tribunal. 6. The ld. Counse....
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....cash. It is very clear from the order of the Assessing Officer that he has given as many as number of opportunities to explain his case before him. However, the assessee has not utilized those opportunities and he was not in a position to explain as to what was the reason for accepting and repaying monies in cash, which is contrary to the provisions of sections 269SS and 269T of the Act. After carefully going through the orders of the Assessing Officer and ld. CIT(Appeals), we are of the opinion that the assessee is not in a position to give any explanation either before the Assessing Officer or before the ld. CIT(Appeals) and therefore, he has avoided to attend before the lower authorities. Now, the ld. Counsel for the assessee is requesting to remit the matter back to the ld. CIT(Appeals), which appears to be not fair, just and proper. Once the assessee's intention is clear that he chose not to appear before the authorities below, it is not justified for us to set aside the order passed by the ld. CIT(Appeals). Therefore, the request of the ld. Counsel for the assessee is rejected. The only argument of the ld. Counsel for the assessee is that the documents found during the course....
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....or taking cash loan. As regards the first of the item of Rs. 85,000 as representing an opening balance, except for a mere statement, there are hardly any materials to show that the said amount was an opening balance. Considering the series of transactions on taking cash loan from various parties, it is difficult to accept the case of the assessee. The Tribunal was therefore justified in law in confirming the levy of penalty under s. 271D. Except for mere statement that the receipt of amount in cash was on account of the business exigency and to meet the liquidity, there is hardly any material to show that in fact there was a real exigency that compelled the assessee to go for cash loan and Tribunal was therefore justified in law in confirming the levy of penalty under s. 271D." 10. Further, in the case of Kasi Consultant Corporation v. CIT (supra), the Hon'ble Jurisdictional High Court had considered similar issue of imposition of penalty under section 271D of the Act and held that the assessee being received deposits from public in violation of section 269SS, there being no material to show reasonable cause, the Tribunal was justified in restoring the order of the Assessing ....