TaxTMI 
TaxTMI 
2026 (5) TMI 414
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.... and liable to be quashed/cancelled/set-aside. 2. For that in the facts and circumstances of the case and in law, opportunity of hearing was not granted by the incumbent authority before imposing penalty u/s. 271D of Rs. 33077252, rendering the impugned order wrong, erroneous, beyond jurisdiction, ab-initio, void, against principles of natural justice and equity. 3. For that in the facts and circumstances of the case and in law, the levy of penalty u/s. 271D of Rs. 33077252 on transaction of refund of advances paid by assessee including receipt of interest thereon of Rs. 77252, is wrong, erroneous, excessive, arbitrary, misconceived, perverse and liable to be quashed/cancelled/set-aside. 4. For that the assessee craves leave to amend, alter, rescind, substitute and/or submit additional ground/grounds of appeal at the time of hearing of appeal." 3. Brief facts of the case as culled out from the order of the Ld. CIT(A) are that the assessee had furnished the return of income on 12.09.2017 declaring total income of (-) Rs.6,65,476/- which was assessed at (-) Rs.6,34,305/- u/s 143(3) of the Act. The JCIT, Range-23, Hooghly issued a notice u/s 274 r.w.s. 27....
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....oes in the area of Bhastara Village. Cold storages used to issue cold storage bond to each rentier /hirer (farmer) at the time of booking of space during the month of March and while releasing potato from the cold storage from the month of May to December or January as per the agreement mentioned in the bond. While releasing the potato, rentier / hirer paid in cash rental charges and insurance charges etc. 4.3.1 It is further seen that Bank extends seasonal cash credit facility to the cold storage units to be utilized for their on lending to their respective loanee farmers against repledge of Cold storage receipts (CSRs) already pledged in favour of cold storage units by the loanee farmers / rentiers at the time of their availing of loan from the cold storage owners. This is a scheme of bank for financing cold storage for on lending to farmers to maintain the quality and extend the life of agricultural products and to reduce losses after harvest and to provide farmers an opportunity to realize better price for their produce. 4.3.2 It is clearly established from the submissions that loan given to the farmers had been recovered in cash by the cold storage assessee w....
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....7. There is a direct nexus of the money having flown from rentiers in the books of account of the assessee, may be towards payment of cold storage activities of the assessee but it does not alter the character of deposit. The company after having received such amount was duty bound to repay back to the creditor which in the instant case may be a Bank or otherwise and it is not the case of the assessee that the amount which was received from Rentiers would remain with the company and was not repayable. The assessee company was duty bound to repay the said loan when demanded by Bank or when company had sufficient liquidity. The conduct or the entry and flowing of funds is sufficient to prove that the amount was admittedly received by cash in the account of assessee as having been received from rentiers and found credited as an "return of loan", proves that it was in the nature of a loan and certainly such loan having been received by cash, falls within the ambit of Section 269-SS. 4.3.8 I have gone through the Notes and Clauses also which have been introduced from 1.4.1984 and the Circular of the Board, though states that the provision was brought into force taking into cons....
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.... filed before us. Since the assessee has requested in Ground No. 2 that the opportunity of being heard was not granted by the authority before imposing the penalty u/s 271D of the Act, the Ld. AR requested that the matter may be remanded to the Ld. JCIT/ACIT for furnishing the required evidence that the money received was on account of repayment of loans which were earlier advanced by the assessee to the farmers and no loan or deposit was actually received from the farmers and, therefore, the provisions of section 269SS of the Act were not attracted. Hence, considering the facts of the case and in the interest of justice and fair play, the order of the Ld. CIT(A) is hereby set aside and the issue is remanded to the Ld. JCIT/ACIT for granting one more opportunity of being heard to the assessee and to consider the evidence to be filed in support of the claim that the money which was received was repayment of the loans earlier advanced to the farmers and therefore, the provisions of sec 269SS of the Act were not applicable and the penalty u/s 271D of the Act was not liable to be imposed and thereafter to reframe the penalty order de novo, if required or delete the penalty if the conte....