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TMI Blog2024 (2) TMI 534X X X X Extracts X X X X X X X X Extracts X X X X ..... uthorities below and find that assessee s father-in-law as well as assessee s wife, who have confirmed that the loan amount shall be treated as gift. The assessee s mother passed away and produced death certificate. Moreover, the assessee has shown reasonable cause for receiving money towards purchase of machineries. Thus, we are of the opinion that the explanation offered against show cause notice before the authorities below were reasonable and therefore, levy of penalty under section 271D of the Act is untenable. As relying on case of Ms. Nanda Kumari v. ITO [ 2019 (1) TMI 413 - MADRAS HIGH COURT] we direct the Assessing Officer to delete the penalty levied under section 271D of the Act. Decided in favour of assessee. - Shri V. D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ans in cash: 1. ₹.1,70,000/- cash loan from Chandrakala (Wife) 2. ₹.2,75,000/- cash loan from Pandiyammal (Mother) 3. ₹.1,17,550/- cash loan from father-in-law (Sathaiah) 4. ₹.2,75,000/- cash received out of the agricultural income Since the Assessing Officer was of the opinion that the assessee has availed cash loan in contravention of provision of section 269SS of the Act, penalty under section 271D of the Act of ₹.8,37,550/- has been levied. On appeal, the ld. CIT(A) confirmed the penalty levied under section 271D of the Act. 3. On being aggrieved, the assessee is in appeal before the Tribunal. The ld. counsel for the assessee has submitted that though the assessee has initially ava ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... copies of the confirmation letters from the lender, which were filed before the authorities below and find that assessee s father-in-law as well as assessee s wife, who have confirmed that the loan amount shall be treated as gift. The assessee s mother passed away and produced death certificate. Moreover, the assessee has shown reasonable cause for receiving money towards purchase of machineries. Thus, we are of the opinion that the explanation offered against show cause notice before the authorities below were reasonable and therefore, levy of penalty under section 271D of the Act is untenable. Moreover, on an identical facts and circumstances in similar issue, in the case of Ms. Nanda Kumari v. ITO (supra), the Hon ble Jurisdictional Hig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s a loan and not a gift because the same was shown in the balance sheet of the assessee filed along with the return of income. Accordingly, the Assessing Officer levied penalty equal to the loan amount. This was challenged by the assessee before the CIT(A), who dismissed the appeal and confirmed the order passed by the Assessing Officer. The assessee filed an appeal before the Tribunal, which allowed the assessee's appeal and while doing so, the Tribunal followed the decisions (i) of the Tribunal in the case of M.Raju Vs. ACIT [ITA.No.899/Mds/2006]; (ii) of the Pune Bench of the Tribunal in the case of ITO Vs. Sunil M. Kasliwal [reported in (2005) 94 ITD 281]; and (iii) of this Court in the case of CIT Vs. http://www.judi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer to establish that the cause shown http://www.judis.nic.in is not a reasonable cause by examining the cause shown and establish that it lacks bona fides. In the instant case, there is no such finding recorded by the Authorities below or for that matter by the Tribunal. Admittedly, the transaction in the instant case is between the assessee and her maternal uncle and aunt and there is nothing on record to show that the transaction lacks bona fides or the assessee came forward with a false case. In the result, we are of the considered view that the case on hand does not warrant levy of penalty under Section 271D of the Act. 14. Accordingly, the appeal filed by the assessee is allowed and the order passed by the Tribunal is set asi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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