2012 (10) TMI 1024 - AT - Income Tax

Summary

Issues involved: Impugned first appellate order on deletion of penalty u/s 271D of the Income-tax Act, 1961.

Summary:
The Revenue challenged the first appellate order deleting a penalty u/s 271D of the Income-tax Act, 1961. The issue revolved around whether the share application money received constituted a loan or deposit, triggering the penalty provision. The assessee relied on a decision of the Hon'ble jurisdictional High Court of Delhi, while the Revenue cited a judgment from the Hon'ble Madras High Court. The AO held the share application money as a loan or deposit, but the assessee argued it was share capital. The CIT(A) ruled in favor of the assessee, following the Delhi High Court decision. The Tribunal upheld the CIT(A) decision, noting a divergence in judicial opinion on the nature of share application money. The Revenue's appeal was declined by the Delhi High Court, affirming the Tribunal's decision. Consequently, the appeal was dismissed, and the first appellate order was upheld based on similar facts and issues as the Delhi High Court case.

Order pronounced on 8th October, 2012.