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TMI Blog2015 (8) TMI 832X X X X Extracts X X X X X X X X Extracts X X X X ..... o meet the urgent business needs of the respondent assessee-company directly in favour of the persons to whom the respondent assessee-company owes money and no cash in any form either loan or deposit was directly given by him to the respondent, assessee-company. Case of CIT Vs. Preeti Fuels and Flames P. Ltd., [2010 (11) TMI 702 - CHHATTISGARH HIGH COURT ] had held that when the transactions in question went through bank and were deposited by some other Directors, the provisions of Section 269SS are not applicable. Case of Gururaj Mini Roller Flour Mills Vs. Additional Commissioner of Income Tax [2015 (2) TMI 362 - ANDHRA PRADESH HIGH COURT] held that, "Mere book adjustment of funds by the assessee vis-à-vis its sister concern can by no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted in connection with the levy of penalty u/s. 271D. v. Any other ground that may be urged at the time of hearing . 2. The brief facts of the case are as under: The respondent is a company incorporated under the provisions of the Companies Act, 1956. The assessee-company is engaged in the business of pharmaceutical formulations, filed the return of income for the Assessment Year (AY) 2005-06 on 01-11-2005 admitting income of ₹ 6,57,378/- before set-off of the brought forward losses. Against the said return of income, the assessment was completed u/s. 143(3) of the Income Tax Act, 1961 [Act] vide order dt. 28-12-2000 at 'NIL' income after setting-off of the brought forwards losses of ₹ 6,95,998/-. The assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gal cases filed by the creditors and other outside agencies against the company. It is further observed that such funds are arranged by the directors of the company to save the company against the above situation. I find force in the contentions of the appellant that since the payments were made for the business exigencies, the provisions of Section 269SS are not applicable to these payments amounting to ₹ 16,69,117/- and accept the same. Further, I observe that the entries made in the books of account are mere book adjustments and the provisions of Section 269SS are clearly not applicable to the facts of the case. Hence, I hold that these payments were made only due to urgent business exigencies as stated by the appellant and on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oposition, he relied upon the following decisions: i. CIT Vs. Manoj Lalwani (2003) 260 ITR 590 (Raj); ii. CIT Vs. Parma nand (2004) 266 ITR 255 (Del); iii. CIT Vs. Sunil Kumar Goel (2009) 315 ITR 255 (Bom); and iv. Srishti Life Needs (P) Ltd., Hyderabad Vs. Addl. CIT, Range- 3, Hyderabad (2015) 2 TMI 245, ITAT, Hyderabad. 6. We heard the rival parties and perused the orders of lower authorities. We find from the perusal of ledger copy furnished by the Ld. AR, no cash entries in the ledger account of Shri K. Anil Kumar were passed. It is only through journal entries the transactions between the respondent assessee-company and the Managing Director Shri K. Anil Kumar were reflected. Further, we notice that Shri K. Anil Kumar ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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