2013 (4) TMI 1018

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....020/- imposed u/s. 271D of the Act because the booking advance received partakes the character of a deposit. 2. On facts and in the circumstances of the case and in law, the CIT (A) ought to have upheld the penalty of Rs. 25,38,020/- imposed U/s. 271D of the Act as the provisions of section 271D of the Act clearly stipulates that if a person takes or accept any loan or deposit in contravention of the provisions of section 269SS, he shall be liable to pay, by way of penalty, a sum equal to the amount of the loan or deposit so taken or accepted. The act does not exempt trade deposit from the ambit of provisions of section 271D. 3. The appellant rely on the decision of Hon. Jharkhand High Court in the case of Bhalotia En....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ng to Rs. 36,52,000/-, it was noted by the AO that the booking advances did not consist the complete address, sales-deed as also the details of the plots allotted were not furnished. According to AO, the assessee had not furnished the true particulars of the persons from whom the deposits were accepted, therefore the amount being accepted otherwise than by an A/c. payee cheque, hence infringed the provisions of section 269SS of the Act. Therefore, levied the penalty u/s. 271D of the Act of Rs. 61,90,020/-. The matter was carried before the first appellate authority. 4. The ld. CIT(A) has discussed facts the facts as well as case-laws and thereupon deleted the penalty as per the following decision:- "4.2. Regarding the ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... of section 269SS of the Act. 5. I have considered the basis of levy of penalty by the Addl.CIT and the arguments of the learned A.R. and also perused the case laws cited by the learned A.R. as mentioned in the preceding paragraphs. I entirely agree with the submissions of the learned A.R. that once the alleged deposits were treated as deemed income u/s. 68 of the I.T. Act by treating the deposit as non-genuine, the penalty cannot be levied u/s. 271D for contravention of section 269SS of the I.T. Act. Similarly, the cash received by the appellant was on account of sale and the same was shown in the books as trade credit or advance against the subsequent sale of any goods, the same cannot be treated as loan or deposit and the provis....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....l has held that since the deposits were trade advances and not deposited from third party, therefore not liable to be penalized u/s. 271D of the Act. Ld.AR has also placed reliance on the following orders:- 1. CIT vs. R.P. Singh & Co. P. Ltd. 304 ITR 217 (Del) 2. CIT vs. Standard Branch Co. 285 ITR 295 (Del) 3. ITO vs. Gurmeet Kaur 144 TTJ 50 (Jd)(UO) 4. DCIT vs. G.S. Entertainment 109 TTJ 54 (Mum) 5. CIT vs. Kailash Tripple Standarised Water (Chennai) P. Ltd. 2 ITR 39 (Mad) 6. CIT vs. Kailash Chandra Deepak Kumar 317 ITR 351 (All) 7. CIT vs. Kharaiti Lal & Co. 270 ITR 445 (PH) 6. Having heard the submissions of both the sides, we are of the view that once the admitted factua....