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Income Tax Appellate Tribunal, “H” BENCH, MUMBAI
Before: SHRI D.T. GARASIA, JM & SHRI MANOJ KUMAR AGGARWAL, AM
Per Manoj Kumar Aggarwal (Accountant Member)
These are two appeals by assessee for Assessment Year [AY] 2011-2012 which assails separate orders of Ld. Commissioner of Income Tax (Appeals)-21 [CIT(A)], Mumbai both dated 16/03/2016 confirming penalty of Rs.3,34,500/- each u/s 271D & u/s 271E of the Income Tax Act, 1961. None is present on behalf of assessee despite being served with the notice. Further, certain defects found by the registry in the appeal documents filed by the assessee and communicated to the assessee as per ‘Defect Notice’ have also not been rectified. Hence, it seems that the assessee is not serious in pursuing his appeals and therefore, we proceed to dispose-off both the appeals on the basis of material available on record and after hearing the revenue.
Briefly stated, the income of the assessee for impugned AY was determined at Rs.8,28,280/- in an assessment u/s 143(3). During assessment proceedings, the assessee was found to have obtained and repaid certain loans / deposits from / to an entity namely M/s Zoom Sales in violation of provisions of Section 269SS & 269T to the tune of Rs.3,34,500/- against which the assessee was saddled with two separate penalties of the same amount u/s 271D & 271E by the appropriate authority. The same was confirmed by the Ld. First Appellate Authority after noting that there was no business dealing between the parties inter-se and also the transactions were not in the nature of current account and after placing reliance on the judgment of Hon’ble Bombay High Court in the case of CIT Vs. Triumph International Finance (I) Ltd. [2012 345 ITR 270]. Aggrieved, the assessee is in appeal before us. 3. The Ld. DR while placing reliance on the decision of the Ld. CIT(A) drew our attention to Section 271D & Section 271E to contend that the case of the assessee squarely fall within the four corners of these sections and therefore, the penalty has rightly been imposed.
ITA No.4497 & 4498/M/2016 M/s Virtuous Health Care Limited Assessment Year 2011-12 4. We have heard the rival contentions and perused relevant material on record. We find that the assessee, before Ld. CIT(A), has admitted to have obtained / repaid the loans in violation of Section 269SS & Section 269T whereas no plausible and acceptable explanation has been furnished for violation of the same. However, we note that the assessee is being penalized twice for the same set of transactions with the same party, which is unreasonable and lacks logic. Therefore, while deleting the penalty u/s 271E, we confirm penalty u/s 271D for acceptance of loan in violation of Section 269SS. The assessee’s appeal assailing penalty u/s 271D is dismissed whereas 271E is allowed.
In nutshell, the assessee’s appeal ITA No. 4497/Mum/2016 is dismissed and ITA No. 4498/Mum/2016 is allowed. Order pronounced in the open court on 10th April, 2017.