2008 (7) TMI 1130

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....n in question from the co-operative society in which he is member, in cash for purchasing tractor and he repaid the loan in cash out of agricultural income derived by him. Therefore, he is not liable for penalty under Sections 271D and 271E of the Income Tax Act. 3. Both the parties were heard regarding the issues raised by the assessee and its legal implications. 4. During the course of hearing the learned Authorised Representative has vehemently argued assailing the orders passed by the departmental authorities contending inter alia that undisputedly, the assessee is purely an agriculturist and having no income chargeable on the Income Tax Act. He is unaware of the tax laws more so, cash loan exceeding Rs. 20,000 should not be taken....

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....ce of law and bona fide and genuine acts of the assessee without having any intention to cause revenue loss or to evade any tax. Therefore, the appreciation of the factual aspects is not in proper perspective and thereby the orders passed by the authorities are not sustainable for legal scrutiny. Accordingly, he sought for setting aside the same by allowing the appeals of the assessee. He relied on the following judicial pronouncements: 1. CIT v. Manoj Lalwani MANU/RH/0405/2002; 2. CIT v. Superintending Engineer, PWD MANU/RH/0618/2002; 3. Motilal Padampat Sugar Mills Co. Ltd. v. State of Uttar Pradesh and Ors. MANU/SC/0336/1978; 4. ITO v. Babu Lal Singhvi 23 Tax World 223 (Jd); 5. Narayan Ram Chh....

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....stablished with the object of helping agriculturist and doing Kacha Adhatia business. The said society is a semi-Government body and the income earned by it is exempt under Section 80P(2) of the Act. Assessee borrowed loan of Rs. 1,85,000 to purchase a tractor from an agriculturist and repaid the same by single payment of Rs. 1,85,000. The assessee has filed an affidavit before the assessing officer during the course of penalty proceedings categorically affirming that he is an agriculturist and member of co-operative society which is formed to help agriculturists and having exemption of its income under Section 80P(2) of the Act, for purpose of purchasing tractor from an agriculturist who has insisted for cash payment. He repaid the amount ....

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....tionally and to conceal any income or to evade payment of tax are only to be penalized in the said quasi criminal proceedings. As can be seen from the undisputed facts stated supra, and affirmed by the assessee by an affidavit, the departmental authorities have not made out any material on record to falsify the affirmed facts in the affidavit filed by the assessee. In the affidavit the assessee has categorically stated that he has no knowledge of the provisions contained in Sections 269SS and 269T of the Act. The Hon'ble Madras High Court has examined similar such circumstance in the case of CIT v. K.P.V. Shaik Mohammed Rowther & Co. (P) Ltd. MANU/TN/1134/1996 wherein it was held that an order imposing penalty for failure to carry out a....