TaxTMI 
TaxTMI 
2017 (8) TMI 726
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....ntial questions of law:- "Whether the Income Tax Appellate Tribunal was justified in law in deleting the penalty under Section 273-D of the Income Tax Act, 1961 amounting to Rs. 46,00,000/- which was levied on account of violation of Section 269-SS of the Income Tax Act, 1961 on the technical ground without going to the spirit of provisions of Section 269-SS of the Income Tax Act, 1961." In an attempt to answer the above question, it is appropriate to narrate some brief facts giving rise to this appeal. The respondent-assessee is a registered firm with four partners dealing in purchase and sale of sugar on commission basis. It has four sister concerns that are assessed to tax separately. In the assessment year 1994-95, the Asses....
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....-to-day business transactions, they were not in the nature of loan or deposit so as to attract the provisions of Section 269-SS of the Act. Section 269-SS of the Act at the relevant time was as under:- ''269SS. Mode of taking or accepting certain loans, deposits.--No person shall after the 30th day of June, 1984, take or accept from any other person (hereafter in this section referred to as the depositor), any loan or deposit otherwise than by an account payee cheque or account payee bank draft or use of electronic clearing system through a bank account, if,-- (a) the amount of such loan or deposit or the aggregate amount of such loan and deposit ; or (b) on the date of taking or accepting such loan or deposit, any loan ....
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....271-D establishes that it is a mandatory provision and a person contravening Section 269-SS of the Act in any manner cannot escape from the payment of penalty equivalent to the amount so received as loan or deposit by him. It is well settled principle of interpretation that the taxing statutes have to be construed strictly and that when the language is clear and unambiguous, it has to be construed in the literal sense bereft of any equitable or social reasons or any hardship likely to be suffered. It is also well recognized that where there is any violation of any provision and a penalty is provided, the fact that the transaction is bonafide, genuine or is doubtful or any other of the like things are not at all germane for the imposit....
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....ur inasmuch as the aforesaid receipt of deposit is after 30th June, 1984 and is not in the manner provided under the aforesaid provision. The contention that the said entries are not in the nature of the loan or deposit on the face of it are not acceptable for the reason that once any amount has been received by the respondent-assessee and the same is shown to have been received in its books of accounts, it partakes the nature of the deposit. Accordingly, the panel provision of Section 271-D gets attracted, leaving no scope for the respondent-assessee to escape from the liability of the penalty. Sri Ashish Bansal has placed reliance upon an unreported judgment of the Division Bench of this Court dated 11.12.2013 passed in Income Ta....
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....spect of the penalty imposed under Section 271-E of the Act for violating Section 269-T of the Act. The appeal of the Revenue against the deletion of the penalty was dismissed as the Tribunal recorded a clear finding of fact that the transactions of deposits were only through bank accounts. This is not the position in the case at hand. Therefore, the aforesaid decision is also of no assistance to the respondent-assessee. The decision of the Dehli High Court in the case of Commissioner of Income Tax Vs. Noida Toll Bridge Company Limited, 262 ITR 260 to the effect that the transfer entries in the books of account by crediting or debiting the accounts of the parties will not amount to the taking or accepting loans or deposits is also of no ....