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TMI Blog2019 (1) TMI 1863X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by Shri Shreeram for his requirement of participating in the tender of the liquor shops then in absence of any fresh material or contrary record to show that the amount was taken as a loan by the assessee for assessee s requirement, the penalty levied U/s 271D and 271E are not justified. When the Assessing Officer was fully satisfied with the explanation that the amount was deposited by Shri Shreeram for the purpose of making D.D. for participating in the tender of the liquor shop then the said explanation of the assessee itself is reasonable explanation to show that the case of the assessee does not fall in the provisions of Section 269SS or 269T of the Act. Accordingly, we delete the penalty levied in both these appeals U/s 271D an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding material and filed his return of income declaring income U/s 44AD of the Act of ₹ 3,08,167/-. During the course of assessment proceedings, the Assessing Officer noted that the assessee has made cash deposit of ₹ 23,36,000/- in his personal savings bank account. The assessee has explained the source of cash deposits which includes a sum of ₹ 2,36,000/- belonging to the friend of the assessee Shri Shreeram, S/o- Shri Richpal Singh deposited for making a Demand Draft (D.D.) for participating in the tenders of liquor shops to be auctioned by the Excise Department. The Assessing Officer had accepted the explanation of source of deposit and consequently no addition was made in the income of the assessee. However, the Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f liquor shop, subsequently, the D.D. were cancelled and the amount was refunded to him, therefore, the Assessing Officer while completing the assessment U/s 143(3) of the Act, accepted the explanation of the assessee regarding the source of deposit of ₹ 3,36,000/- from Shri Shreeram, S/o- Shri Richpal Singh. Once the assessee has explained the source as the amount belongs to Shri Shreeram, who got the D.D. from the bank account of the assessee for participating in the tender of the liquor shop then it will not fall in the ambit of the term loan or deposit deceived by the assessee so as to attract the provisions of Section 269SS and 269T of the Act and consequently the penalty levied U/s 271D and 271E of the Act are not justified. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spute that the amount of ₹ 3,36,000/- was deposited in cash by the assessee as taken from one Shri Shreeram, S/o- Shri Richpal Singh, therefore, the same is in contravention of provisions of Section 269SS of the Act. Further the said amount was also repaid by the assessee to Shri Shreeram in cash and again it is in contravention of the provisions of Section 269T of the Act. He has further contended that the assessee has only made submissions and not filed any documentary evidence to establish that the depositor used the amount for his own purpose of obtaining the license in his own name. No correspondence from the Excise Department to the effect was produced by the assessee in support of the claim. Further the assessee also could not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and explanation furnished by the assessee regarding the deposit of ₹ 3,36,000/- makes it clear that this amount was deposited for making a D.D. in favour of the Excise Department for participating in the tender of the liquor shops by one Shri Shreeram, S/o- Shri Richpal Singh. The assessee also submitted an affidavit of Shri Shreeram in this regard. The Assessing Officer was satisfied with this explanation of the assessee and did not raise any objection about the purpose and source of deposit. Once the Assessing Officer has accepted the explanation as furnished by the assessee during the assessment proceedings and has not given any finding about the nature of the deposit in the bank account then the said explanation cannot be out rig ..... X X X X Extracts X X X X X X X X Extracts X X X X
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