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Income Tax Appellate Tribunal, AHMEDABAD “SMC” BENCH
Before: SHRI MAHAVIR PRASAD & SHRI AMARJIT SINGH
PER MAHAVIR PRASAD, JUDICIAL MEMBER
These four appeals filed by the Assessee are directed against the order of the Ld. CIT(A)-4, Vadodara dated 28.08.2017 pertaining to A.Ys. 2010-11 and 2012-13. The assessee has taken following grounds of appeal:
ITA Nos. 2793 to 2796/Ahd/2017 2 . A.Ys. 2010-11 & 2012-13 1. The learned Commissioner of Income Tax (Appeals) has erred in passing an Ex- Parte order without providing reasonable opportunity of being heard to the Appellant hence the same being illegal and bad in law requires to be cancelled. 2. The learned Commissioner of Income Tax (Appeals) has erred in confirming the action of the Joint Comm. of Income Tax , Anand in passing an ex-parte order u/s.271D of the I. T. Act,1961 same being against the principles of natural justice and law requires to be quashed. 3. The learned Commissioner of Income Tax (Appeals) has erred in confirming the penalty of Rs.7,25,000/- levied by the Assessing Officer u/s.271D of the Income Tax Act, 1961. 4. The Appellant craves leave to add, alter, amend or modify any of the grounds of appeal on or before the date of hearing of appeal.
Facts of the case are that the AO vide letter No, AND/ITO Wd.3/45/BCP/l5-16 dated 17.11.2015 has referred the case for penalty u/s.271D & 271E tor violation of provisions of section 269SS and 269T of the IT Act. Accordingly, a show cause notice u/s.274 r.w.s 271D dated 19.11.2015 was issued and served upon the assessee. Hearing for this purpose was fixed on 30.11.2015. In response to this notice nobody attended. Thereafter another opportunity was given to the assessee " vide show cause notice/s.274 r.w.s.271D dated 20.01.2016. None has attended. As the assessee has not turned upon this date, another opportunity was given vide show cause notice u/s.274 r.w.s.271D dated 15.02.2016 and served upon the assessee on 16.02.2016. None has attended. No letter of adjournment filed nor any submission furnished.
In this case, the assessee has received cash deposits as under: Name of the Date Accepted Repaid Mode of person payment Chhotabhai 10.05.2009 225000 Cash Trikambhai Patel
ITA Nos. 2793 to 2796/Ahd/2017 3 . A.Ys. 2010-11 & 2012-13 Ramesh 20.07.2009 100000 Cash Chotabhai
Patel
-do- 08.03.2010 50000 Cash
Arun 25.10.2009 50000 Cash Chotabhai Patel
-do- 08.03.2010 50000 Cash
Saroj 15.07.2009 100000 Cash parshotam Patel
-do- 20.11.2009 100000 Cash
-do- 06.03.2010 100000 Cash
-do- 08.03.2010 100000 Cash
Vinubhai 10.07.2009 150000 Cash Chotabhai Patel
Total 725000 300000 Cash
From the above table it is very clear that the assessee has contravened the provisions of section 269SS of the IT Act. However, the section 269SS of the Act clearly shows that " No person shall, after the 30th day of June, 1984 take or accept form any other person (hereafter in this section referred to as the depositor) any loan or deposit otherwise than by an account payee cheque or account payee draft drawn in the name of the person who has made the loan or deposit [or by use of electronic clearing system through a bank account] if-, (d) The amount of the loan or deposit or the aggregate of such loan and deposit; or (e) On the date of taking accepting such loan or deposit, any loan or deposit taken or accepted earlier by such person from the depositor is
ITA Nos. 2793 to 2796/Ahd/2017 4 . A.Ys. 2010-11 & 2012-13 remaining unpaid (Whether repayment has fallen due or not), the amount of aggregate amount remaining unpaid; or (f) The amount or the aggregate amount referred to in clause(a) together with the amount or the aggregate amount referred to in clause(b), is twenty thousand ruppes or more." Therefore, the plain reading of the section shows that if the aggregate of the amount the assessee repaid otherwise than by an account payee cheque or account payee draft[or by use of electronic clearing system through a bank account], then he would be liable to penal action u/s.271D of the Act. The same is found in the case of the assessee. From the facts of the case, it is seen that the assessee is not disputing the deposits of cash as mentioned above in cash. Therefore the assessee has violated the provision of section 269SS of the IT Act by repaying loan from various persons aggregating to Rs.7,25,000/- in cash without any reasonable cause. The assessee has not complied with section 269SSS of the IT Act. In the light of the above discussion as well as the facts of the case, it is proved beyond doubt that the assessee has repaid in cash the loan amounting to Rs.7,25,000/- in contravention of the provisions of section 269SSS of the Act and therefore it is a fit case for levy of penalty u.s,271D of the IT Act. The penalty leviable works out to Rs.7,25,000/- which is equal to 100% amount accepted in cash. Therefore, penalty of Rs.7,25,000/- u/s.271D of the IT Act for AY 2012-13 is levied accordingly."
Thereafter against the order of the ld. A.O., assessee preferred first statutory appeal before the ld. CIT(A) and matter was fixed on 20.03.2016, 10.07.2017 & 02.08.2017. But none appeared on behalf of the assessee. And thereafter on the
ITA Nos. 2793 to 2796/Ahd/2017 5 . A.Ys. 2010-11 & 2012-13 basis of M.P. High Court judgment in the case of Estate of Late Tukojirao Holkar Vs CWT 223 ITR 480 (M.P.) dismissed the appeal of the assessee.
We have gone through the relevant record and impugned order. And at the outset, ld. A.R. cited an order of Co-ordinate Bench in the matter of Gujarat Themis Biosyn Ltd. vs. Joint Commissioner of Income-tax [2000] 74 ITD 339 (AHD.) wherein it is held that “it is mandatory and obligatory for Commissioner of Income Tax (Appeals) to pass a speaking order stating points raised in appeal, his decision thereon and reasons for such decision.”
In this case, appellant has been in default for not appearing before the ld. CIT(A) despite of the fact that matter was fixed thrice by the ld. CIT(A) but appellant did not appear. In the interest of justice, we are of the considered view that one more opportunity should be given to the appellant and subject to the condition that appellant shall deposit Rs. 10,000/- as a fine with the revenue and thereafter own production of receipt of Rs. 10,000/-, ld. CIT(A) will decide the matters in accordance with law and after given an opportunity of being heard to the assessee.
In the result, appeals filed by the Assessee are allowed for statistical purposes in term and condition mentioned therein.
Order pronounced in Open Court on 24 - 04- 2019
Sd/- Sd/- (AMARJIT SINGH) (MAHAVIR PRASAD) ACCOUNTANT MEMBER True Copy JUDICIAL MEMBER Ahmedabad: Dated 24/04/2019