TaxTMI 
TaxTMI 
2009 (9) TMI 1005
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.... the assessee has not contravened the provisions of section 268SS of the Act. 2. The ld. CIT(A) failed to appreciate the fact that the assessee could not justify the contravention of the provisions of section 269SS." 2. Facts, in brief, as per relevant orders are that during the course of assessment proceedings for the AY 2005-06, the Assessing Officer[AO in short] noticed that the assessee accepted following amount of loans in cash in contravention of provisions of sec. 269SS of the Income-tax Act,1961[hereinafter referred to as the 'Act']:- Sr.No. Name Amount(Rs) Amount (Rs.) 1. R.D. Shah (HUF) 20,000 10,000 19,000 ....
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....re bona fide as also genuine, the provisions of section 269SS were not attracted in her case, the assessee pleaded. Inter alia, the assessee relied upon a number of decisions. However, the Additional CIT rejected these contentions of the assessee on the ground that the cash loans were accepted from various relatives in violation of provisions of section 269SS of the Act. Accordingly, there being no reasonable cause within the meaning of provisions of sec. 273B of the Act, the Addl CIT imposed a penalty of Rs. 7,47,408 u/s.271D of the Act . 3. On appeal, while reiterating their submissions before the Addl. CIT and relying on the decisions in the case of Kalakrithi v. ITO (2002) 253 ITR 754 (Mad.), ADI(Investigation) Vs. Kum. A.B.Shanti, D....
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.... I hold that the AO was not justified in levying the penalty under section 271D of the I.T. Act, 1961. Accordingly the AO is directed to delete the penalty levied." 4. The Revenue is now in appeal against the aforesaid findings of the ld. CIT(Appeals) The ld. DR supported the order of the Add. CIT and the ld. AR on behalf of the assessee supported the findings of the ld. CIT(A) while relying upon the decisions in the case of CIT Vs. Sunil Kumar Goel,315 ITR 163 (P & H), CIT Vs. Maheshwari Nirman Udhyog,302 ITR 201 (Raj),Hindustan Steel Ltd. Vs. State of Orissa, 83 ITR 26 (SC) Addl. CIT Vs. I.M.Patel & Co.,107 ITR 214(Guj) (Guj),Vir Sales Corporation Vs.ACIT, 50 TTJ 130[Ahmedabad]. 5. We have heard rival submissions and gone through th....
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....the aforesaid amounts received from her relatives by the assessee were not in the nature of loans and deposits . There is nothing on record to show that these transactions were attached with certain conditions or stipulation as to period of repayment, rate of interest, manner of repayment, etc. so as to treat the said transactions as loan or deposit. Revenue have not placed before us any material, rebutting the findings of facts recorded by the ld. CIT(A). Since there is nothing on record to suggest that the transactions are in the nature of loan or deposit, apparently, the provisions of section 269SS are not attracted. The meaning of "deposit " and " loan " has been explained on page 8454 of the Chaturvedi and Pithisaria's Income-tax L....
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....its which are for a fixed period or loans which are for a fixed period, the point of repayment may arise in a different manner. But by and large, the transaction of a loan and the transaction of making a deposit are not always considered identical. " In the light of aforesaid distinction between loan and deposit, especially when there is nothing to suggest in the case under consideration the aforesaid transactions are in the nature of loan or deposit, we are of the opinion that provisions of sec. 269SS are not attracted in this case. 5.2 There is another aspect of the matter. In the case of Bombay Conductors & Electricals Ltd. Vs. DCIT,56 TTJ 580(Ahd.), the Tribunal found that there was no evidence on record to show that infraction of....
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.... members. Hon'ble Punjab & Haryana High Court in the case of Sunil Kumar Goel(supra) while relying upon their decision in the case of CIT Vs.Saini Medical Store,277 ITR 420(P&H) concluded that bonafide belief coupled with the genuineness of transactions would constitute reasonable cause within the meaning of provisions of sec. 273B of the Act It was held that a family transaction between two independent assessees based on an act of casualness, specially when disclosure is contained in the accounts would establish reasonable cause within the meaning of provisions of sec. 273B of the Act. Coming to the facts of the case under consideration, we notice that no loss of revenue has occurred in this case and the genuineness of the transaction has ....