KASHYAP M. TANNA,MUMBAI vs. ADDL.C.I.T. RG.11(2), MUMBAI

2 अमेर�कन ए�स�ेस ब�क �ल�मटेड M/s American Express ITA 1064/Mum/2014 2. At the outset, the appeal of the assessee is barred by limitation by 3 days. In support, the assessee has filed a petition for condonation of delay along with an affidavit stating that, when the order of the CIT(A) was received in the office of the Chartered Accountant, he was not in town due to death of his family member. Immediately after returning back, he filed the appeal. Thus, there was a reasonable cause in not filing the appeal in time.

After hearing the parties and going through the averments made in the affidavit, we find that there was a reasonable cause in not filing the appeal in time and accordingly, we find it fit case for condoning the delay.

In the present case, penalty has been levied on repayment of loan of Rs. 1 lakh otherwise than by account payee cheque or bank draft to Kunty M. Tanna, that is, in cash in violation of section 269T. The Ld. CIT(A) too has confirmed penalty being in violation of section 269T.

Before us the Ld. Counsel submitted that, admittedly it is repayment of loan and in view of the scope of penalty as prescribed under section 271E prior to 01.06.2003, no penalty was leviable on loan because the word “loan” has been inserted in the said section only w.e.f. 01.04.2003. Here in this case, the matter pertains

The Ld. DR, on the other hand, strongly relied upon the order of the AO.

After considering the rival submissions and on perusal of the relevant material on record, we find that, it is an undisputed fact that the penalty has been levied on repayment of loan in cash. The penalty under section 271E as it stood at the relevant time, did not had the word “loan” and the only word used in the section was repayment of any “deposit”. Thus, in AY 1995-96, no penalty was leviable on account of repayment of any loan in violation of section 269T. The word “loan” in section 271E has been brought in the statute by the Finance Act, 2003 w.e.f. 01.03.2003. On this preliminary ground alone, we hold that no penalty can be levied under section 271E for repayment of loan in cash in the assessment year 1995-96. Accordingly, penalty of Rs. 1,00,000/- levied is hereby deleted.

In the result, appeal of the assessee stands allowed. Order pronounced in the open court on 31st May, 2016. Sd/- Sd/- (राज�) (अिमत शु�ला) लेखा सद�य �याईक सद�य (RAJENDRA) (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Date: 31st May, 2016