TaxTMI 
TaxTMI 
2013 (10) TMI 1497
X X X X Extracts X X X X
X X X X Extracts X X X X
...., 1961 ('the Act' hereinafter) for the assessment year (A.Y.) 2001-02. 2. The appeals raising common issues, were posted for hearing and, accordingly, heard together, and are being decided by a common, consolidated order. The brief facts of the case are that the assessee, a partnership firm, being a builder and developer, was found during the course of the assessment proceedings by the Assessing Officer (A.O.) to have received a sum of Rs. 4.35 lacs from one, M/s. Sahakar Developers, in cash during the relevant year, so that there had been a clear violation of section 269SS of the Act. The assessee was, accordingly, show caused in the matter, whereat it was explained that the sum received was in fact not a 'loan or deposit....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the authorities below was in terms of the sums having been received from a sister concern, having a common partner in Shri Kamlesh Gangar, with both the concerns having in fact offices at the same place at Borivali, Mumbai and, two, of having acted bona fide, with no ulterior motive, with the transactions being recorded in the regular books of accounts of both the parties, and which would, therefore, constitute a reasonable cause u/s.273B of the Act, saving penalty. With reference to the decision by the apex court in the case of Hindustan Steel Ltd. v. State of Orissa [1972] 83 ITR 26 (SC), it is claimed that there was no deliberate defiance of law or guilt of conduct contumacious or conscious disregard of its obligation, so as to attract ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hanthi (supra), where there was a genuine and bona fide transaction and the tax payer could not get a loan or deposit by account-payee cheque or account-payee demand draft for some reason, the authority vested with the power to impose the penalty has the discretionary power not to levy the penalty. This would then sum up or define the parameters under which the applicability or otherwise of the decision in the case of Hindustan Steel Ltd. (supra) would need to be considered qua the penalties under reference. In other words, the transaction being genuine or bona fide, though representing an essential condition for saving penalty would itself not be sufficient. Rather, non-genuine transaction was held as outside the scope of the penal provisi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nd from its very inception (i.e., 11.07.1981), the said words were defined in sec. 269T to mean any loan or deposit of money which is repayable after a notice or repayable after a period. The enhancement in the scope of s. 269T, so as to include loan or deposit of any nature, i.e., in case of a person other than a company, is only by Finance Act, 2003 w.e.f. 01.06.2002. Clearly, the cash received by the assessee from its sister concern cannot be said to be repayable after a notice or after a period, i.e., in terms of the definition obtaining at the time of its acceptance (16.06.2000) or repayment (14.07.2000). Its repayment would, thus, stand to be ousted and, thus, not hit by section 269T. No penalty u/s.271E of the Act, on an ostensible d....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ng so, do not in any manner suggest that where cash entries are duly recorded in the books of accounts of both the recipient and the payer, i.e., represent genuine transactions of cash paid and received, the same would by itself constitute a reasonable cause, excluding penalty u/s.271D / 271E of the Act. This is as this is precisely what stands barred by sections 269SS and 269T, which, therefore, are to be regarded as substantive provisions, proscribing acceptance and repayment of loan or deposit of money otherwise than by account-payee cheque or account-payee bank draft where the threshold limit is exceeded, as in the instant case. But only that in the given circumstances of this case, where cash has been accepted by the assessee-firm from....