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Income Tax Appellate Tribunal, CUTTACK BENCH,
Before: SHRI N.S SAINI & SHRI ABY T. VARKEY
IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE SHRI N.S SAINI, ACCOUNTANT MEMBER AND SHRI ABY T. VARKEY, JUDICIAL MEMBER
ITA No.115/CTK/2016 Assessment Year :2008-09
Sri Dipak Kumar Sahu, S/O. Vs. JCIT, Balasore Range, Muralidhar Sahu, At/PO: Balasore Jaleswar, Dist: Balasore. PAN/GIR No. ADBPS 8726 K (Appellant) .. ( Respondent)
Assessee by : Shri P.K.Mishra, AR Revenue by : Shri Asit Kumar Mohapatra, CIT DR
Date of Hearing : 16 /02/ 2017 Date of Pronouncement : 17 /02/ 2017
O R D E R Per Bench This is an appeal filed by the assessee against the order of CIT(A)-
Cuttack, dated 8.12.2015, for the assessment year 2008-09.
The sole ground of appeal taken by the assessee in this appeal is that
the ld CIT(A) is not justified in sustaining the penalty of Rs.3,00,000/- as
against Rs.3,28,176/- imposed by the Assessing Officer u/s.271E of the
Act.
We have heard the rival submissions and perused the orders of lower
authorities and materials available on record. In the instant case, the
2 ITA No. 115/CT K/ 2016 Asse ssment Year :20 08- 09
Assessing Officer found that the assessee has repaid loan/deposit in cash
in contravention of the provisions of section 269T of the Act. Therefore,
the JCIT, Balasore Range after getting such information issued notice u/s.
274 read with section 271E of the Act to the assessee. He found that the
assessee has repaid loan in cash to five persons totaling to Rs.3,28,176/-
during the year. The assessee submitted to the query of the JCIT, that the
persons are living in their native villages and having no bank accounts due
to non-availability of banking facilities in the nearby areas. The JCIT was
not satisfied with such explanation. He relied on the decision of Delhi Bench
of the Tribunal in the case of Ajay Goel Vs. ACIT, Range-28, New Delhi, 126
ITD 89, where it was held that merely because the amount of Rs.2,00,000/-
has been repaid in part not exceeding Rs.20,000/- on a single day would
not absolve the assessee from the rigours of section 269T as was clear from
the section itself. It was held that the assessee has violated the provisions
of section 269 T of the Act by repaying loan/deposits in cash in
contravention of the said provisions and has therefore become liable for
penalty u/s. 271E of the Act for penalty of Rs.3,28,176/- U/s. 271E of the
Act and levied penalty accordingly.
On appeal, the CIT(A) observed that the payment made to Kanchan
Bala Thakkar amounting to Rs.20,386/- and Sri Banmali Mishra amounting
to Rs.47,790/- may not come strictly as contravention of the provisions of
section 269T of the Act. As regards the rest of the payments/deposits in
cash is concerned, it appears that the assessee has made convenient
arrangements with his family members regarding the rest of the amount
3 ITA No. 115/CT K/ 2016 Asse ssment Year :20 08- 09
repaid in cash. Therefore, he considered those payments as violation of
provisions of section 269T of the Act and, accordingly confirmed the penalty
of Rs.3,00,000/-.
Before us, ld A.R. of the assessee has relied on the decision of Hon’ble
Jharkhand High Court in the case of OMEC Engineers vs CIT, 294 ITR 599
(Jhar) and submitted that the Hon’ble High Court has held that there being
no finding of the Assessing Officer, the CIT(A) or the Tribunal that the
transaction made by the assessee in breach of provisions of section 269SS
was not a genuine transaction, penalty u/s.271D is not leviable merely for
technical mistake. He submitted that similarly in assessee’s case, the
return having been accepted under section 143(3) after scrutiny, there
being also no finding that transactions were malafide aimed at disclosing
concealed money, imposition of penalty under section 271D merely for
technical mistake could not be sustained.
Ld D.R. on the other hand relied on the orders of lower authorities.
We find that in the instant case, penalty of Rs.3,28,176/- u/s.271E
was imposed by the Assessing Officer and ld CIT(A) restricted the penalty
to Rs.3,00,000/- on the ground of making repayment/deposit in cash by
the assessee to the family members. Ld A.R. of the assessee has relied on
the decision of Hon’ble Jharkhand High Court in the case of OMEC Engineers
(supra), wherein, it has been held that there being no finding of the
Assessing Officer, the CIT(A) or the Tribunal that the transaction made by
the assessee in breach of provisions of section 269SS was not a genuine
transaction, penalty u/s.271D is not leviable merely for technical mistake.
4 ITA No. 115/CT K/ 2016 Asse ssment Year :20 08- 09
Similarly, in the present case also, we find that there is no finding of the
Assessing Officer or the CIT(A) that the transactions in violation of section
269SS of the Act were not genuine. The assessee’s return has been
accepted u/s.143(3) of the Act after scrutiny. There is no finding that the
transactions were malafide aimed at disclosing concealed money.
Therefore, respectfully the decision in the case of OMEC Engineers (supra),
we delete the levy of penalty of Rs.3,00,000/- u/s.271E of the Act and allow
the ground of appeal of the assessee.
In the result, the appeal filed by the assessee is allowed. Order pronounced in the open court on 17 /02/2017 in the presence of parties.
Sd/- sd/- ( Aby T. Varkey) (N.S Saini) JUDICIAL MEMBER ACCOUNTANT MEMBER
Cuttack; Dated 17 /02/2017 B.K.Parida, SPS Copy of the Order forwarded to : 1. The Appellant : Sri Dipak Kumar Sahu, S/O. Muralidhar Sahu, At/PO: Jaleswar, Dist: Balasore 2. The Respondent. JCIT, Balasore Range, Balasore 3. The CIT(A) Cuttack 4. Pr.CIT, Cuttack 5. DR, ITAT, Cuttack 6. Guard file. BY ORDER, //True Copy//
SR.PRIVATE SECRETARY ITAT, Cuttack