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TMI Blog2022 (6) TMI 1233X X X X Extracts X X X X X X X X Extracts X X X X ..... counted income into the system. We find that these are genuine transactions carried out in the normal course of the business of the assessee. Hence, if the aforesaid transactions are looked into from the perspective of the object and intention behind introduction of provisions of section 269SS and 269T of the Act , then the provisions of section 269SS and 269T of the Act cannot be made applicable to the facts of the instant case. Moreover, from the detailed explanation of the aforesaid transactions together with the purpose for which those journal entries were passed, it could be safely concluded that these entries neither reflect any receipt of loan nor repayment of loan. - Decided in favour of assessee. - ITA No. 4052/MUM/2019 - - - Dated:- 3-6-2022 - Shri Aby T Varkey, Judicial Member And Shri S Rifaur Rahman, Accountant Member For the Revenue : Shri Mehul Jain (DR) For the Assessee : Shri Niraj Sheth (AR) ORDER PER S. RIFAUR RAHMAN, AM This is an appeal filed by the revenue against the order dated 05.03.2019 of Learned Commissioner of Income Tax (Appeals)-49, Mumbai [hereinafter in short Ld. CIT(A) ] for the assessment year 2015-16. 2. Brief fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aw, the Ld. CIT(A) is justified in holding the journal entries should enjoy equal immunity on par with account payee cheques and bank drafts? 3. Whether, on the facts and circumstances of the case and in law, the Ld. CIT(A) was justified in giving the benefit of reasonable cause to a series of transactions, without appreciating that such benefit is available as an exception rather than a rule, to unlawfully granting perpetual legitimacy to transactions otherwise held to be illegal.? 6. At the time of hearing, it is brought to our notice that the issue under consideration is in favour of the assessee. 7. On the other hand, Ld. DR also clearly agreed with the above facts on record however, he relied on the orders passed by the AO. 8. Considered the rival submissions and perused the material placed on record. We observed that in the preceding assessment year i.e. assessment year 2014-15, co-ordinate Bench has considered the issue and decided the issue in favour of the assessee, for the sake of brevity, we reproduce the same herein under: 3.5. We find the entire gamut of the case had been dealt in detail by the ld. CIT(A) in his order which have already been narrat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gard, we find that the Hon ‟ ble Jurisdictional High Court had addressed the similar issue whether the aforesaid behaviour of the assessee would constitute reasonable cause u/s 273B of the Act to escape from the rigors of applicability of provisions of section 269SS and 269T of the Act in the case of CIT vs Triumph International Finance (I) Ltd reported in 208 Taxman 299 (Bom). The relevant operative portion of the said decision is reproduced hereunder:- 23. The expression 'reasonable cause' used in Section 273B is not defined under the Act. Unlike the expression 'sufficient cause' used in Section 249(3), 253(5) and 260A(2A) of the Act, the legislature has used the expression 'reasonable cause' in Section 273B of the Act. A cause which is reasonable may not be a sufficient cause. Thus, the expression 'reasonable cause' would have wider connotation than the expression 'sufficient cause'. Therefore, the expression 'reasonable cause' in Section 273B for non-imposition of penalty under Section 271E would have to be construed liberally depending upon the facts of each case. 24. In the present case, the cause shown by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in 229 Taxman 560 (Del) in the similar set of facts and circumstances had categorically observed as under:- 8. A plain reading of the aforesaid Section indicates that (the import of the above provision is limited) it applies to a transaction where a deposit or a loan is accepted by an assessee, otherwise than by an account payee cheque or an account payee draft. The ambit of the Section is clearly restricted to transaction involving acceptance of money and not intended to affect cases where a debt or a liability arises on account of book entries. The object of the Section is to prevent transactions in currency. This is also clearly explicit from clause (iii) of the explanation to Section 269SS of the Act which defines loan or deposit to mean loan or deposit of money . The liability recorded in the books of accounts by way of journal entries, i.e. crediting the account of a party to whom monies are payable or debiting the account of a party from whom monies are receivable in the books of accounts, is clearly outside the ambit of the provision of Section 269SS of the Act, because passing such entries does not involve acceptance of any loan or deposit of money. In the present ..... X X X X Extracts X X X X X X X X Extracts X X X X
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