TaxTMI 
TaxTMI 
2019 (5) TMI 6
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.... 1961 (here-in-after referred to as "the Act") dated 16/09/2015relevant toAssessment Year (AY) 2008-09. 2. The only issue raised by the assessee is that Ld. CIT (A) erred in confirming the penalty u/s 271D of the Income Tax Act, 1961, amounting to Rs. 2,54,000/- 3. Briefly stated facts are that the assessee is an individual and engaged in the business of Share Trading. The assessee during the year has received a sum of Rs. 2,54,000/- in cash on different dates from his father. The assessee claimed that Rs. 2,54,000/- received from his father in cash is representing the gift. The assessee in support of his claim filed a Gift Deed prepared on the Stamp Paper of Rs. 50 dated 17-5-2011. 4. However, the AO observed that the gift was rec....
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....n. iv) The assessee received the gift on different dates in piece meals. 4.3 In view of the above the AO held that the cash received by the assessee from his father does not represent the gift as claimed by him. Therefore, the AO held the assessee had received an unsecured loan from his father in contravention to the provisions of section 269SS of the Act. Accordingly the AO levied the penalty of Rs. 2,54,000/- under the provision of section 271D of the Act. 5. Aggrieved assessee preferred an appeal to Ld. CIT (A). The assessee before the Ld. CIT (A) submitted that the Gift Deed was not prepared at the time of taking the gift because assessee was not aware of the taxation provision. The Gift Deed was prepared when it was felt....
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....011, during the assessment proceedings and its contents cannot be brushed aside merely on the ground that it was not prepared during the relevant time. The Ld. AR drew our attention on page 42 to 43 of the paper book where the Gift Deed was placed. 6.2 The gift received from the father was shown as a liability in the financial statement. But the character of the transaction cannot be changed on the classification of the same under the head liability in the balance sheet. 6.3 The Ld. AR, further submitted that the provision of section 269SS was brought under the statue intending to deterring the assessee of justifying unaccounted cash found during search/survey. As such the object of the provision of section 269SS was to discourage the....
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....Ld. DR submitted that the cash received by the assessee is representing the unsecured loan which was accepted against the provision of section 269SS of the Act. The Ld. DR vehemently supported the order of the authorities below: 8. We have heard the rival contention and perused the materials available on record. 8.1 From the preceding discussion we note certain facts as detailed under: i) The AO did not doubt the genuineness of the transaction. Otherwise the same should have been treated as unexplained cash credit u/s 68 of the Act. ii) The transaction was carried out with the father of the assessee. 9. At this juncture we find important to refer to the Circular issued by the CBDT bearing No.387 dated 06/07/1984 w....
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.... or accepted earlier by such person from the depositor is remaining unpaid (whether repayment has fallen due or not), and the amount or the aggregate amount remaining unpaid is Rs. 10,000 or more. The prohibition will also apply in cases where the amount of such loan or deposit, together with the aggregate amount remaining unpaid on the date of which such loan or deposit is proposed to be taken is Rs. 10,000 or more.'' 9.1 From the above we note that the provision of section 269SS was brought under the statue to discourage the assessee to justify their unaccounted money. However, in the case on hand, there is no allegation that the assessee has introduced unaccounted money in his business. Thus, keeping in view the object of the provisio....
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.... not prepared at the relevant time. The controversy arises merely delay in preparation of Gift Deed can cause prejudice to the assessee by holding that the cash transaction is not in the nature of the gift. In this regard we note that a Gift Deed is nothing but an understanding in writing which proves/establishes the nature of transaction carried out between the parties. Once the donor has agreed/confirmed that he had given a gift to the assessee, then the same cannot be denied merely on the ground that the Gift Deed was not prepared at the relevant time. 9.5 Further, without prejudice, even if it was given a loan at that relevant time and later on the parties agreed to treat the same as a gift, then the matter ends here as the transacti....