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TMI Blog2019 (1) TMI 847X X X X Extracts X X X X X X X X Extracts X X X X ..... in cash, which led to the imposition of the instant penalty. Further, the assessee had a bank liability of about ₹ 50 crore against mortgage of assets of about ₹ 5 crore only, which fact has not been falsified. The submissions made by the assessee in this regard have not been controverted by the AO or the ld. CIT(A) in any manner. When this fact is seen in the light of return filed by the assessee declaring loss of ₹ 4.35 lakhs, it clearly emerges that the loans were taken by the assessee in cash in violation of provisions of section 269SS to meet the financial liabilities. This in our considered opinion constitutes a reasonable cause warranting non-imposition of penalty u/s.271D of the Act in terms of section 273B of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to why penalty u/s.271D of the Act be not imposed in this regard, the assessee submitted that its business activities were close and inoperative for about last 7 years and the assessee firm had borrowed money from many private money lenders and Shree Suvarna Sahakari Bank Ltd. since last 10 years. To meet the financial crunch of the firm, the assessee raised certain loans in cash from unorganized finance sector for disposing off its existing liabilities. The AO imposed penalty of the equal sum of ₹ 79,18,000/-. The assessee approached the ld. CIT(A) who noticed that the correct amount of loans was to the tune of ₹ 88,18,000/- and not ₹ 79,18,000/- for which the penalty was imposed by the AO. After entertaining objections ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs. To meet the financial requirements of repayment, for which the lenders were hard pressing, the assessee had to borrow money from unorganized finance sector in cash, which led to the imposition of the instant penalty. Further, the assessee had a bank liability of about ₹ 50 crore against mortgage of assets of about ₹ 5 crore only, which fact has not been falsified. The submissions made by the assessee in this regard have not been controverted by the AO or the ld. CIT(A) in any manner. When this fact is seen in the light of return filed by the assessee declaring loss of ₹ 4.35 lakhs, it clearly emerges that the loans were taken by the assessee in cash in violation of provisions of section 269SS to meet the financial liab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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