ITO, NEW DELHI vs. SH. BALBIR SINGH, NEW DELHI

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ITA 4576/DEL/2011Status: DisposedITAT Delhi24 January 2017AY 2007-084 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that neither the AO nor the CIT(A) had sufficient evidence to support their respective contentions. The order of the CIT(A) was set aside, and the matter was restored to the AO for a fresh decision.

What were the facts?

The assessee accepted loans in cash exceeding Rs. 20,000 from six parties, violating Section 269SS. The Assessing Officer (AO) imposed a penalty, rejecting the assessee's claim that the loans were for agricultural purposes and from individuals not chargeable to tax. The Commissioner (Appeals) cancelled the penalty.

What were the issues?

Whether the assessee had a reasonable cause for accepting loans in cash in violation of Section 269SS, and whether the lenders were not chargeable to tax.

Which sections of the Income-tax Act were involved?

Section 269SS,Section 271D

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘A’ : NEW DELHI

Before: SHRI G.D. AGRAWAL & SHRI KULDIP SINGH

For Appellant: Shri Raj Kumar Gupta & Sumit Goel, CAs
For Respondent: Shri S.K. Jain, Senior DR
Hearing: 19.01.2017

(PAN : AKDPS1094D) (APPELLANT) (RESPONDENT) ASSESSEE BY : S/Shri Raj Kumar Gupta & Sumit Goel, CAs REVENUE BY : Shri S.K. Jain, Senior DR Date of Hearing : 19.01.2017 Date of Order : 24.01.2017

O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : Present appeal was originally decided by ITAT, Delhi Bench ‘A’ vide order dated 12.07.2013 ex-parte as none appeared on behalf of the assessee. Subsequently, on the basis of order dated 17.06.2016 passed by the Tribunal on the basis of misc. application filed by the assessee, the order dated 12.07.2013 stood recalled and now the present appeal is being decided afresh.

2.

The Appellant, Income Tax Officer, Ward 26 (3), New Delhi (hereinafter referred to as ‘the Revenue’) by filing the present appeal sought to set aside the impugned order dated 25.08.2011, passed by the Commissioner of Income-tax (Appeals)-XXIV, New Delhi under section 271D of the Income-tax Act, 1961 (for short ‘the Act’) qua the assessment year 2007-08 on the grounds inter alia that :-

“1. On the facts and circumstances of the case, the Ld. CIT (A) erred in cancelling the penalty imposed u/s 271D of the I.T. Act, 1961 as the CIT (A) has ignored the inconsistencies in the submissions made by the assessee. 2. On the facts and circumstances of the case, the CIT (A) has erred in accepting self serving documents not corroborated by cross examination. 3. Set aside the order of the CIT (A) and restore the matter back to the AO to reexamine fresh evidence in a holistic manner.”

3.

Briefly stated facts of this case are : assessment of the assessee for the AY 2007-08 was completed under section 143(3) of the Act vide order dated 04.12.2009 and it was noticed that the assessee has taken loans in cash from six parties to the extent of exceeding Rs.20,000/- each in violation of section 269SS of the Act. Then, penalty proceedings were initiated and assessee was called upon to explain as to why penalty u/s 271D be not imposed on him for accepting loans in cash in violation of section 269SS.

Assessee made submission that he has taken advances only for agricultural purposes and as such, section 269SS is not applicable as none of the lenders were chargeable to tax under the Act. Being not satisfied with the explanation furnished by the assessee, AO came to the conclusion that since from the return of income filed by the assessee for AY 2007-08 and preceding years, it is clear that he has been deriving income from pension, bank interest and income from property business which is chargeable to tax under the Act and as such, his case is not covered under Second Proviso to section 269SS and imposed the penalty of Rs.26,00,000/-.

4.

Assessee carried the matter before the ld. CIT (A) by way of filing the appeal who has allowed the appeal. Feeling aggrieved, the Revenue has come up before the Tribunal by way of filing the present appeal.

5.

We have heard the ld. Authorized Representatives of the parties to the appeal, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case.

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