2007 (12) TMI 186

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....Income-tax Act ?" 2. The relevant assessment year is 1997-98. The assessee is running a benefit fund and doing finance business. The Assessing Officer initiated penalty proceedings under section 271D of the Income-tax Act on the premise that the assessee had violated the provisions of section 269SS of the Income-tax Act, 1961, by taking or accepting loans or deposits from various persons otherwise than account payee cheques or account payee drafts exceeding Rs. 20,000. Though a detailed statement as to the nature and location of the business concern of the assessee and the reason for accepting the amounts not by account payee cheques and account payee drafts has been placed before the Assessing Officer, the Assessing Officer was of the opi....

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.... section 271D and dismissed the appeal. The correctness of the same is put in issue in this appeal before us by formulating the above question of law. 3. We heard the argument of learned counsel on either side and perused the materials on record. 4. Before the Commissioner of Income-tax (Appeals), the assessee has stated nine instances of receipt of deposits over and above Rs. 20,000 by cash and has given details that the depositors were agriculturists and made the deposits from out of their savings from agricultural income and further stated that none of the persons from whom the deposits were received in cash were having any bank accounts. That was confirmed by the depositors concerned. The circumstances under which such deposits receiv....

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....rovides for penalty not imposable in  certain cases. The section reads thus : "Penalty not to be imposed in certain cases.— Notwithstanding anything contained in the provisions of clause (b) of sub-section (1) of section 271, section 271A, section 271AA, section 271B, section 271BA, section 271BB, section 271C, section 271D, section 271E, section 271F, section 271FA, section 271FB, section 271G, clause (c) or clause (d) of sub-section (1) or sub-section (2) of section 272A, sub-section (1) of section 272AA or section 272B or sub-section (1) of section 272BB or sub-section (1) of section 272BBB or clause (b) of sub-section (1) or clause (b) or clause (c) of sub-section (2) of section 273, no penalty shall be imposable on the person o....