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TMI Blog2019 (4) TMI 503X X X X Extracts X X X X X X X X Extracts X X X X ..... nds of appeals: 1. The Order of the learned Commissioner of Income Tax (Appeals) is erroneous on facts and circumstances of the case and in law. 2. The ld. CIT(A) rred in deleting the Penalty of Rs. 75,14,000/- levied by the Addl. CIT, Central Range-2, Chennai, in the order passed u/s.271D of the IT Act, 1961 for the AY 2013-14. 2.1. The ld. CIT(A) erred by not considering the fact that the assessee failed to prove during the course of penalty proceedings that the funds were transferred from one account to the other account by way of Joint Venture as held by him. 2.2. The ld. CIT(A) ought to have taken into account, the decision rendered by the Hon'ble Allahabad High Court in the case of CIT Vs M/s. Sunil Sugar Co. Kanpur, wherein i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Assessing Officer issued notice u/s.153A of the Act and the assessments were completed for the AYs 2008-09 to 2014-15 u/s.143(3) r.w.s.153A of the Act vide order dated 29.02.2016. During the course of these assessment proceedings, the Assessing Officer observed that the respondent-assessee had been accepting the loans and deposits in cash exceeding sum of Rs. 20,000/- in violation of provisions of Sec.269SS of the Act. The details of such loans and deposits were as follows: Sl.No. Deposit received in cash from Date of deposit Amount (in Rs.) Total 1 SMMCH & RI 20.03.2013 75,14,000/- 75,14,000/- 2 Shri Sethuraman. R 10.11.2012 45,000/- 45,000/- 3 Shri Venkatraman.S 10.11.2012 45,000/- 45,000/- 4 Shri Jayaraman 10. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd only journal entries have been passed and there was no deviation u/s 269T of the I T Act. h) We submit we are a Nidhi Company and loans are given mostly to salaried and lower middle income group at favourable rates of interest strictly in accordance with the norms prescribed by the Ministry of Corporate Affairs and RBI and so any penal action against our company would affect the financial position of the company and will affect the NIDHI approval and legal status of the company. 5. The Assessing Officer after considering the above submissions held that the provisions of Sec.269SS are attracted once the aggregate of the amounts received exceeds sum of Rs. 20,000/- even if single amount received does not exceed Rs. 20,000/-. As regards ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the Assessing Officer and the Ld.CIT(A) ought not have considered the fresh material filed before him for the first time in violation of provisions of Rule 46A and also submitted that any amount received otherwise than by way of Cheque or Demand Draft are hit by the provisions of Sec.269SS of the IT Act and reliance in this regard was placed on the decision of the Hon'ble Allahabad High Court in the case of CIT v. Sunil Sugar Co. Kanpur. On the other hand, the Ld.Counsel, Shri G.Baskar has submitted that the deposits were renewed through transfer entries. The journal entries passed in respect of the deposits of the students belonging to Sri Muthukumaran Medical College & Research Institute (SMMCH & RI) amounting to Rs. 75,14,000/- t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are received by way of transfer entries. On appeal before the Ld.CIT(A), the penalty came to be deleted considering the facts that the deposits were received by way of journal entry in which case the provisions of Sec.269SS are not attracted, placing reliance on the decision of the Hon'ble Madras High Court in the case of Worldwide Township Projects Ltd. It is a matter of record that before the Assessing Officer the stand respondent-assessee was that the amount was received by way of transfer from AMACE Saving Bank Account. Before us, it was stated that AMACE is another division of the respondent-assessee. Whereas during the course of proceedings before the Ld.CIT(A), the explanation offered was that journal entry was passed by transferri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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