Assessee made repayments of loans/deposits through modes other ...

Loan/deposit repayments via non-account payee modes breach Sec 269T; penalty u/s 271E deleted for CSA dues adjusted against deposits.

January 18, 2025

Case Laws Income Tax AT

Assessee made repayments of loans/deposits through modes other than account payee cheques/drafts, violating Section 269T. Penalty u/s 271E was imposed. ITAT bifurcated transactions into those with related parties and Customer Sales Agents (CSAs). For CSA transactions, outstanding dues were adjusted against security deposits through journal entries, breaching Section 269SS. However, ITAT held this constituted 'reasonable cause' u/s 273B, not attracting penalty u/s 271E, relying on Ajitnath Hi-Tech Builders (P.) Ltd. [2018 (2) TMI 603 - Bombay HC]. Consequently, ITAT set aside CIT(A)'s order and directed AO to delete penalty levied u/s 271E, deciding in favor of assessee.

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Assessee made repayments of loans/deposits through modes other ...

Loan/deposit repayments via non-account payee modes breach Sec 269T; penalty u/s 271E deleted for CSA dues adjusted against deposits.

January 18, 2025

Case Laws Income Tax AT

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