2020 (4) TMI 485

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....is time barred. Referring to the provisions of clause (c) of section 275(1) of the Act, ld. Counsel for the assessee submitted that the penalty order passed on 29.11.2016 is a time barred one. Otherwise, on merits of levy of penalty, ld. Counsel fairly relied upon the submissions made by the assessee before the lower authorities. 3. Briefly stated the relevant facts include that the assessee is a medical professional and a Gynecologist. The assessee took loans from the following creditors in cash and also through NEFT i.e. Electronic Transfer amounting to Rs. 61,67,114/-. The details of cash loans as well as Electronic Transfer loans are tabulated as under :- Sr. No. Name of the creditor Cash (Rs.) NEFT/Electronic Transfer....

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....d legal position on penalty u/s 271D is that once it is proved that a person has received loans otherwise than by account payee cheque or account payee bank draft, penalty is exigible unless it is was a reasonable cause for failure to adhere to the provisions of law. In practical sense, it has been held by various courts that if the loans are genuine and there was a urgency or compulsion to accept them in contravention of provisions of section 269SS, then the assessee can get protection under reasonable cause as per section 273B. But the assessee would have to prove both things a. Loans were genuine. b. There was urgency or compulsion for contravention of provisions of section 269SS. However, the assessee....

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....than by account payee cheque or account payee bank draft." 6. During the first appellate proceedings, the CIT(A) gave part relief to the assessee. The relevant discussion given in para 9 of the order of the CIT(A). In this order, the CIT(A) was of the opinion that the assessee gets relief so far as loan taken through electronic (NEFT) transfer is concerned. Thus, he granted relief to the extent of Rs. 27,72,655/-. Regarding the balance of Rs. 33,94,459/-, the CIT(A) confirmed the penalty as per discussion given in para 9 of his order. 7. During the proceedings before us, ld. Counsel for the assessee fairly mentioned that the assessee is entitled to relief on the legal ground. On this legal ground, ld. Counsel mentioned that the pen....

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....financial year, is 2016-17 in this case and the relevant month of initiation of penalty, is April, 2016. Therefore, the order passed by the Assessing Officer on 29.11.2016 is very much valid and not time barred. Accordingly, we order. Thus, the legal issue raised by the assessee in ground no.1 stands dismissed. 12. Coming to the merits, we find this is a clear case of receipt of cash by the assessee in violation of section 269SS of the Act. Further, we perused the order of the CIT(A) and find para 9 of the CIT(A)'s order is relevant and the same is extracted hereunder :- "9. I have carefully considered the facts of the case as well as reply of the appellant. As far as loan of Shri Rajiv Keshav Karande and Shri Anil Keshav Kar....