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TMI Blog2015 (12) TMI 553X X X X Extracts X X X X X X X X Extracts X X X X ..... l. In the course of assessment proceedings for the impugned assessment year, the Assessing Officer, noticing that the assessee has accepted cash loan of Rs. 2.50 lakh in violation of provisions of section 269SS of the Act, forwarded information to the appropriate authority for initiating action for imposition of penalty under section 271D. As a consequence, proceedings for imposition of penalty under section 271D, was initiated with issuance of show cause notice on 22nd December 2010 to the assessee. In response to the said show cause notice, it was explained by the assessee that he had received cash of Rs. 2.50 lakh from M/s. Edna Misquitta on 3rd August 2006. It was submitted that said Ms. Edna Misquitta's husband had immovable property f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the name of Ms. Edna Misquitta. Thus, on the basis of the above, the authority concerned proceeded to pass an order on 10th February 2011, imposing penalty of Rs. 2.50 lakh under section 271D of the Act. 3. Being aggrieved of penalty order so passed, the assessee preferred appeal before the first appellate authority. The learned Commissioner (Appeals), after considering the submissions of the assessee and examining the facts and materials on record, observed that on going through the power of attorney, it was not indicated that relationship between the assessee and M/s. Edna Misquitta, is in the nature of trustee and trust. He also observed that no documentary evidence could be produced by the assessee to demonstrate that the amount re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 (Ahd.). Lastly, the learned counsel submitted that when the assessee is able to show reasonable cause for accepting the amount in cash and the transaction is bona fide, no penalty is imposable. In this regard, he relied upon the decision of the Hon'ble Gujarat High Court in Bombay Conductors and Electricals Ltd., 301 ITR 328 (Guj.). 5. The learned Departmental Representative, on the other hand, submitted that the provisions of section 269SS puts a bar on cash transaction exceeding certain prescribed limit. Therefore, receipt of loan exceeding the prescribed limit in cash straight away attracts the provisions of section 269SS. The learned Departmental Representative submitted that power of attorney executed by Ms. Edna Misquitta, has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of holding the money of the lady in trust, the assessee would not have shown it as loan in its books of account and financial statement. As far as the contention of the learned Counsel for the assessee that the transaction is bona fide and there is no accounted money, hence, provisions of section 263SS is not applicable, we are unable to accept such contention of the assessee. On reading of the provisions of section 269SS of the Act, it is very clear that it is applicable to a situation where cash loan is accepted in excess of the prescribed limit. Therefore, there is nothing in the said provision to show that it will apply only in a case where unaccounted cash is introduced or transaction is not bona fide. Therefore, in the facts of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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