9911796707
TMI Blog2013 (6) TMI 309X X X X Extracts X X X X X X X X Extracts X X X X ..... SR)/2010 for the assessment year 2005-06:- 1. Whether on the facts and circumstances of the case the learned Income Tax Appellate Tribunal is justified in deleting the penalty of Rs.10.27 lacs imposed by the Joint Commissioner of Income Tax under Section 271D for contravention of the provisions of Section 269SS of the I.T. Act, 1961, without appreciating the basic intent of the leniency provided in the 2nd proviso to Section 269SS, which is meant only for such persons as are agriculturist, who are obliged to avail loans in agricultural and rural circumstances, and the facts of the case clearly do not suggest, far less prove, the existence of such factors in favour of the assessee? 2. Whether on the facts and the circumstances of the case, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er dated 13.6.2011 allowed the appeal and deleted the entire amount of penalty amounting to Rs.10.27 lacs. Hence, the present appeal by the revenue. 4. Learned counsel for the revenue submitted that the assessee-respondent had accepted loans exceeding Rs.20,000/- in violation of the provisions of Section 269SS of the Act as the same was received in cash whereas it had to be by account payee cheque or bank draft. According to the learned counsel, the assessee was, thus, liable for violation of the aforesaid provision for penalty under Section 271D of the Act. It was urged that the Tribunal had erred in cancelling the penalty by holding that the case of the assessee was covered under 2nd proviso to Section 269SS of the Act. 5. We have given ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utions, associations or bodies which the Central government may, for reasons to be recorded in writing, notify in this behalf in the Official Gazette: Provided further that the provisions of this section shall not apply to any loan or deposit where the person from whom the loan or deposit is taken or accepted and the person by whom the loan or deposit is taken or accepted are both having agricultural income and neither of them has any income chargeable to tax under this Act. Explanation.- For the purposes of this section,- (i) "banking company" means a company to which the Banking Regulation Act, 1949 (10 of 1949), applies and includes any bank or banking institution referred to in section 51 of that Act; (ii) "co-operative bank" shall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 269SS of the Act, including the case laws cited by the Ld. Counsel for the assessee. It is evident that the assessee became partner in the firm on 26.08.2004. The loans which were considered by the lower authorities, in the light of provisions of section 269SS read with section 271D of the Act, were prior to the date of becoming a partner of the assessee-firm. Both the lender and borrower, as contended by the Ld. Counsel for the assessee, are agriculturists and did not have any income chargeable to tax. This factum could not be rebutted by the Ld. DR. Therefore, the contention of Ld. Counsel for the assessee is supported by the second proviso to section 269SS of the Act, and by the aforesaid case laws relied upon by him." 9. The said findi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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