2015 (9) TMI 1102

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....elevant facts of the case are that the assessee company who is stated to be engaged in the manufacturing of furniture as per the assessment order u/s 143(2) dated 24.12.2008 claimed an increase in share capital. In view of the fact that the assessee received and repaid loans thereby violating the provisions of section 269SS and Section 269T as per page 1 & 2 of the assessment order penalties u/s 271D and 271E were initiated on the following facts:- "Loans Taken in cash-violation of section 269SS of Income Tax Act, 1961:- Date Name of the Person Amount 29.06.2005 Divas Jain 25,000/- 31.10.2005 -do- 10,000/- 08.03.2006 Gokul Chand Jain 1,00,000/- 31.10.2005 -do- 20,000/- 15.05.2005 Madhu J....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....king of the company. Apart from that following submissions extracted from the penalty order were also found to be made:- 1. "The assessee company accounted for each entry and also explained the source of the same. 2. The amount is taken from director and one shareholder. All the persons are income tax assessees. 3. All the transactions are genuine and duly verified during the course of assessment. 4. Transactions made between the company and directors/shareholders were under exceptional circumstances to accommodate the emergency needs of the company for a very short and temporary period. 5. The assessee company is managed by the members of the same family. 6. The assessee had no intentio....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... from whom only Rs. 40,000/- was received in cash, the remaining persons it was submitted were Directors and whole time Directors of the assessee company and in order to meet the business needs of the assessee company, cash was received from them and subsequently also paid to them. The assessee being ignorant of the legal consequences considering the fact that all persons were known, tax paying assessees from the same family made payment and were repaid in cash in a bonafide belief for business exigencies on account of ignorance of the provisions of law as they had tried to keep the family business running. In these circumstances, it was his submission that keeping in mind that the intention for introducing the section was to tackle unaccou....