2015 (4) TMI 1077

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....Penalty under dispute was imposed by JCIT, Range-12, Kolkata u/s. 271D of the Act vide his order dated 29.06.2007. 2. The sole issue in this appeal of assessee is against the order of CIT(A) confirming the penalty imposed by JCIT u/s. 271D of the Act. For this, assessee has raised following concise ground: "For that the Ld. CIT(A) erred in confirming the penalty imposed by the AO u/s. 271D amounting to Rs. 3,98,719/-." 3. Briefly stated facts are that the assessee is engaged in the business of civil construction and filed its return of income on 11.10.2004 for AY 2004-05. During the course of assessment proceedings, while completing assessment u/s. 143(3) of the Act vide order dated 27.12.2006, the AO noticed that the assessee company t....

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..... Mahmood and not Rs. 6 lacs as alleged. Finally, it was confirmed that only Rs. 3,98,719/- was cash loan. The JCIT after considering the reply noted the fact that the assessee company received cash loan from its director Md. Mahmood and the relevant finding of fact by him in page 3 of penalty order reads as under: "The assessee has also filed a copy of the ledger account of unsecured loan, a certificate from Rupanjan Associates, Chartered Accountant, the details of unsecured loan taken from director, copy of the bank account of the company M/s. Mahmood Associates Pvt. Ltd. with Allahabad Bank, Park Circus Branch and copy of the bank account of Md. Mahmood the director of the company with Allahabad Bank, Park Circus Branch in support of h....

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....269SS of the Income-tax Act, 1961, and the assessee was liable to pay penalty under section 271D. However, the Tribunal vacated the penalty so imposed on the finding that the said payment was not by way of deposit or loan, but towards adjustments of the amount drawn by the promoter from the company's account. On an application praying for an order calling for a reference from the order of the Tribunal: Held, that the finding arrived at by the Tribunal was a finding of fact and, therefore, did not give rise to any question of law to be answered by the court." 6. He also referred to the decision of Hon'ble Madras High court in the case of CIT Vs. Idhayam Publications Ltd. (2006) 285 ITR 221 (Mad), wherein the Hon'ble High court has held....

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....f loan or advance, there is no violation of section 269SS of the Income-tax Act. We find no error in the order of the Tribunal and the same requires no interference. Hence, no substantial question of law arises for consideration of the court. Accordingly, we dismiss the above tax case." 7. Ld. Counsel for the assessee also referred to the decision of Hon'ble Gujarat High Court in the case of CIT Vs. Natvarlal Purshottamdas Pareekh (2008)303 ITR 5 (Guj), wherein Hon'ble High Court has reproduced para 18 of Tribunal's order and confirmed the issue as under: "18. As discussed above, the annexure attached to the penalty order goes to show that each of the family members of the assessee and each one of them was having sufficient opening bala....