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Issues involved: Appeal against penalty imposed under section 271D of the Income Tax Act, 1961 for accepting cash loans exceeding Rs. 20,000 u/s 269-SS.
Summary: The appeal was filed by the Revenue against the Tribunal's judgment upholding penalty on the assessee for accepting cash loans exceeding the limit specified in section 269-SS of the Income Tax Act, 1961. The CIT (Appeals) had initially set aside the penalty, but the Tribunal reinstated it for loans received from various financiers, while deleting the penalty for loans accepted from the HUF of the partners of the assessee firm. The appellant contended that the Tribunal erred in not imposing penalty uniformly for all loans, arguing that the distinction made between loans from individual financiers and the HUF of partners was unjustified under section 269-SS. However, it was noted that all loan transactions were genuine, and the assessee provided valid reasons for accepting cash loans due to the urgent nature of construction business requirements. The Tribunal's decision was supported by the provisions of section 273B, which allow for penalty waiver under certain circumstances where justification for accepting cash loans is shown. Citing a relevant Supreme Court case, it was emphasized that discretion exists not to impose penalty in such cases. Ultimately, the Court found no error in the Tribunal's decision, as the loans were legitimate, and valid reasons were presented for accepting cash payments. Consequently, the appeal was dismissed, and no legal question was deemed to arise for consideration.
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