TaxTMI 
TaxTMI 
2025 (6) TMI 407
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....its return on 30.10.2018 declaring total income of Rs. 16,76,37,960/-. The case was selected for scrutiny and the assessment proceedings were completed by passing an order u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') on 01.05.2019 assessing the total income at Rs. 17,26,37,960/- by making addition of Rs. 50 lakhs. Subsequently on the basis of search and seizure action conducted in the case of one Shri Sachin Nahar on 01.08.2017 during which various incriminating documents were found and seized. On perusal of the seized documents it was gathered that the assessee M/s. Mantra Properties has taken cash loan of Rs. 1,90,00,000/- from the various parties through finance broker Shri Sachin Nahar during the financial year 2016-17 and has paid interest amounting to Rs. 12,97,500/- which includes Rs. 12,78,750/- in financial year 2016-17 and Rs. 18,750/- in financial year 2017-18 against these loans. Accordingly, the case of the assessee was reopened by issue of notice u/s 148 of the Act. The assessee filed its return of income in response to notice u/s 148 of the Act on 30.09.2021 declaring total income of Rs. 16,76,37,960/-. The Assessing Officer completed....
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....e of Shri Sachin Nahar who has confirmed the fact that cash loan was provided to Shri Satish Gupta who is a partner of the firm. Therefore, there it is not a presumption but evidences. However, if the cash loan was taken by some other entity/person of the group, then onus lies with the assessee to prove the same. Further, during the assessment proceedings, the Authorised representative of assessee was provided cross examination of Shri Sachin Nahar. During cross examination, in the reply of question number 4, Shri Sachin Nahar indentified Mantra as Mantra Properties. During the cross examination this fact was not rebutted by the AR of the assessee. Therefore, there is no doubt that the abbreviation matra is Mantra Properties. The above facts prove that the penalty was correctly initiated. Further, the assessee relied upon the two case laws as mentioned above. However, facts of both the quoted cases are different from facts of this case. Penalty in both the quoted case laws were levied mere on the basis of statement of third party, however in the instant case, the penalty has been initiated on the basis of Incriminating material corroborated by the statement recorded u/s 132(4) of t....
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.... 9. From the above facts, it is clear that the assessee has accepted loan in cash amounting to Rs. 1,90,00,000/-. Further from the incriminating documents and statement of Shri Sachin Nahar wherein he had admitted the fact that cash loan was provided to the assessee. Therefore, by accepting cash more than Rs. 20,000/- the assessee has violated provisions of S. 269SS of the Act. As per provisions of S. 271D of the Act, if a person violates the provisions of S.269SS of the Act, then he/she/it may be liable for levy of penalty u/s 271D of the Act. Thus, for accepting loan in cash to the tune of Rs. 1,90,00,000/-, the assessee is liable to pay penalty as per provisions of S. 271D of the Act. 10. In view of the above discussion, it is proved that that the assessee has violated the provisions of S. 269SS of the Act without having any reasonable cause within the meaning of S.273B of the Act, making itself liable for levy of penalty u/s. 271D of the Act. I, therefore, levy a penalty of Rs. 1,90,00,000/- which is equal to the said loan accepted by the assessee in cash in the FY 2016-17 relevant to A.Y. 2017-18. 11. Demand Notice is being issued accordingly." 6. In appea....
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....on u/s 276SS r.w.s. 271D of the Act. Accordingly, penalty levied of Rs. 1,90,00,000/- u/s 271D is hereby deleted. Grounds No. 1 to 4 raised by the appellant are. therefore, allowed." 7. Aggrieved with such order of the Ld. CIT(A), the Revenue is in appeal before the Tribunal by raising the following grounds: 1) On the facts and in the circumstances of the case and in law, the Ld.CIT(A) has erred in deleting the penalty u/s 271D of the Act of Rs. 1,90,00,000/- holding that the assessee cannot be penalized just on the basis of general statement of third party without appreciating the facts that Shri. Sachin Nahar in his statement recorded u/s 132(4) of the Act and during cross examination had affirmed the identification of code 'Mantra' as 'Mantra Properties and Authorized Representative of the assessee was not able to rebut the same. 2) On the facts and in the circumstances of the case and in law, the Ld.CIT(A) has erred in not considering the incriminating evidences/material found during the search action, establishing that the assessee had taken cash loan of Rs. 1,90,00,000/- from various parties through Shri Sachin Nahar. 3) The appellant....