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Issues involved:
The appeal challenges the levy of penalty u/s 271D of the Income-tax Act by the CIT(A) in relation to the receipt of cash amounts from the assessee's father for the purchase of a vehicle. Details of the Judgment: Issue 1: Violation of Section 269SS and Penalty under Section 271D The assessee received cash amounts from his father for purchasing a vehicle, leading to a penalty under section 271D for alleged violation of section 269SS. The Income-tax Officer initiated penalty proceedings, contending that the amounts could have been received through account payee cheques. The penalty of Rs. 70,000 was levied, which was upheld by the CIT(A). Issue 2: Assessee's Arguments and CIT(A)'s Decision The assessee argued that the father's contribution for the vehicle purchase should not attract penalty under section 271D. However, the CIT(A) considered the contribution as a deemed gift due to lack of gift-tax return filing by the father, leading to the confirmation of the penalty. Issue 3: Assessee's Defense and Tribunal's Decision The assessee's counsel contended that the father's contribution was not a loan or deposit, thus not warranting a penalty u/s 271D. Additionally, the cash receipt was justified due to the urgency of availing a concession at the Gwalior Fair. The Tribunal noted that the amount received was not a loan or deposit, as there was no obligation to return it, and the assessee proved a reasonable cause for receiving cash. Consequently, the penalty u/s 271D was canceled, and the appeal was allowed. In conclusion, the Tribunal ruled in favor of the assessee, canceling the penalty imposed u/s 271D, considering the circumstances and reasonable cause shown for the cash receipt from the father for the vehicle purchase.
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