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TMI Blog2015 (11) TMI 918X X X X Extracts X X X X X X X X Extracts X X X X ..... plication money being not in the nature of loan or deposit. In these circumstances, the learned Commissioner of Income-tax (Appeals) has rightly followed the decision of CIT v. Vegetable Products Ltd. [1973 (1) TMI 1 - SUPREME Court] and accordingly cancelled the penalty imposed by the Assessing Officer under section 271D by following the view which is in favour of the assessee. Her impugned order cancelling the penalty imposed under section 271D is, therefore, upheld and this appeal filed by the Revenue is dismissed. - Decided in favour of assessee. - I. T. A. No. 314 /Hyd/ 2015 - - - Dated:- 1-7-2015 - P. M. JAGTAP (Accountant Member) Bandi Ramakrishna for the appellant. Sanjay Kumar for the respondent. ORDER 1. Thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cer, relying on the decision of the hon'ble Jharkhand High Court in the case of Bhalotia Engineering Works P. Ltd. v. CIT [2005] 275 ITR 399 (Jharkhand), wherein it was held that share application money partakes the character of deposit, since it is repayable in specie on refusal to allot shares. Accordingly, relying on the decision of the hon'ble Jharkand High Court in the case of Bhalotia Engineering Works P. Ltd. (supra) as well as the decision of the hon'ble Bombay High Court in the case of Dhanji R. Zalte v. Asst. CIT [2004] 265 ITR 204 (Bom), a penalty of ₹ 35 lakhs was imposed by the Assessing Officer under section 271D. 3. The penalty imposed by the Assessing Officer under section 271D was challenged by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by following the ratio of the decisions which are in favour of the assessee. Aggrieved by the order of the learned Commissioner of Income-tax (Appeals), the Revenue has preferred this appeal before the Tribunal. 5. I have heard the arguments of both sides and also perused the relevant material on record. It is observed that although there are some case-law including the decision of the hon'ble Jharkhand High Court in the case of Bhalotia Engineering Works P. Ltd. v. CIT [2005] 275 ITR 399 (Jharkhand), which are in favour of the Revenue, taking a view that the share application money partakes the character of loan or deposit, there are various other case law as cited by the assessee before the learned Commissioner of Income-tax (Appe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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