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Facts
The Revenue appealed against the CIT(A)'s order deleting penalties levied under Sections 271D and 271E. The penalties were imposed on the assessee, a credit co-operative society, for availing and repaying cash loans. The assessee's members reportedly lack access to regular banking facilities.
Held
The Tribunal held that the assessee had demonstrated a 'reasonable cause' for its actions, considering it is a credit co-operative society serving members in remote areas without access to regular banking facilities. Therefore, the Tribunal found no reason to interfere with the CIT(A)'s deletion of the penalties.
Key Issues
Whether the assessee, a credit co-operative society, had a reasonable cause for availing and repaying cash loans, thereby justifying the deletion of penalties under Section 271D and 271E.
Sections Cited
271D, 271E, 269SS, 269T
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Income Tax Appellate Tribunal, “DB” BENCH, AGRA
Before: SHRI SATBEER SINGH GODARA & SHRI MANOJ KUMAR AGGARWAL
ORDER
PER SATBEER SINGH GODARA, JUDICIAL MEMBER:
This Revenue’s appeal for assessment year 2015-16 arises against Commissioner of Income Tax (Appeals) [in short, the “CIT(A)”] Gwalior’s order dated 31.10.2019, in case No. CIT(A)Gwl/10257/2018-19, in proceedings under Section 271D & 271E of the Income Tax Act, 1961, [hereinafter referred to as ‘the Act’].
Case called twice. None appears at the assessee’s behest. It is accordingly proceeded ex-parte.
United Credit Co-operative Society Ltd. 3. The Revenue vehemently argues during the course of hearing the CIT(A) impugned lower appellate discussion has erred in law and on facts in reversing the Assessing Officer action levying Section 271D and 271E penalties of Rs.57,82,600/- and Rs.32,70,000/-; respectively, levied in assessee’s case for having availed and repaid cash loans.
We have given a thoughtful consideration to all the relevant facts emerging from the case records. Suffice to say, this assessee is admittedly a credit co-operative society; serving to it’s members only, in various remote places. And that all of the said members do not access to regular banking facilities as well. That being the clinching case, we are of the considered view that the assessee has indeed made out a “reasonable cause” so as to get out of the rigor of section 269SS and section 269T of the Act. We accordingly see no reason to interfere with the learned CIT(A)’s finding deleting the impugned sections 271d and 271E penalties herein.
This Revenue’s appeal is dismissed.
Order pronounced in the open court on 10.02.2025