2016 (3) TMI 541

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....the assessee wherein on facts the assessee had been found in assessment proceedings u/s 147/148 to have repaid a loan of Rs. 13 lacs to Sh. Harish Bindal & Tarun Bindal in cash. The levy of penalty was challenged unsuccessfully in appeal before the CIT (A) on various grounds including the grounds of reasonable cause. Aggrieved by this, the assessee is in appeal before the Tribunal. The background of the case as canvassed before the AO in the penalty proceedings vide letter dated 21.03.2013 is reproduced hereunder:- ".......Repayment of loans in cash is covered by section 269T of Income tax Act. The assessee is very near relative of Mr. Harish Bindal (brother-in-law) and Mr.Tarun Bindal who is son of Mr. Harish Bindal. All repayment of loan....

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....of Income Tax Act is not covered in this case. The assessee agreed that only section 269 T is partly covered in this case as the near relation Mr. Harish Bindal demanded cash and he has accepted the receipt of cash against their loan account. Section 269T was introduced with a view to counter the evasion of tax. In the instant cash the source of repayment of loan is proved with all documentary evidence. The allegation made in the Tax Evasion Petition received from Shri.B.D.Gupta may be dropped. We request your honour to drop this proceedings u/s 147/148 of Income Tax Act because this is the complaint from an anonymous person and whose identity is not verify by the Department. This complain is basically from Mr.Harish Bindal who is near re....

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....port of the said claim, attention was invited to copy of the complaint dated 04.05.2005 filed in the police station before the SHO, Shalimar Bagh, u/s 498A/406 diary No.7946 dated 05.05.2005 (copy placed at pages 18 to 21 of the Paper Book). Ld.AR pleaded that in order to buy peace the assessee had agreed to repay the loan in cash as insisted instead of by cheque. It was submitted that the assessee's explanation that the payment had been made in cash on account of the peculiar unfortunate delicate situation can constitute a reasonable cause. Accordingly it was his prayer that the penalty may be quashed. In the alternate it was submitted the assessee has also raised additional grounds, canvassing that the penalty is time-barred and deser....