Commissioner of Income Tax v. Triumph International Finance (I) Ltd.

DCIT Cen Cir 7(3), Mumbai vs. Sumangla Developers P. Ltd, Mumbai

In the result, all the captioned appeals preferred by revenue stands dismissed and the CO of the assessee also stands dismissed

…i.e. the acceptance/repayment of loan/advance/deposit is in violation of modes specified in Section 269SS & Section 269T of the Act. We find that the said issue is no longer res-integra as held by the Hon’ble Bombay High Court in CIT Vs. Triump International (345 ITR 270) wherein their Lordships held C.O. 275 & 276/Mum/2018 A.Y. 2010-11 & 2012-13 Kesarinanadan Township. that the receipt of any advance/loan by way of journal entries is in breach of Section 269SS of the Act. In such a scenario, the next question is whether penalty is leviable for breach of Section 269SS/269T of the Act. In the present cases, the A…

DCIT Cen Cir 7(3), Mumbai vs. Sumangla Developers P. Ltd, Mumbai

In the result, all the captioned appeals preferred by revenue stands dismissed and the CO of the assessee also stands dismissed

…i.e. the acceptance/repayment of loan/advance/deposit is in violation of modes specified in Section 269SS & Section 269T of the Act. We find that the said issue is no longer res-integra as held by the Hon’ble Bombay High Court in CIT Vs. Triump International (345 ITR 270) wherein their Lordships held C.O. 275 & 276/Mum/2018 A.Y. 2010-11 & 2012-13 Kesarinanadan Township. that the receipt of any advance/loan by way of journal entries is in breach of Section 269SS of the Act. In such a scenario, the next question is whether penalty is leviable for breach of Section 269SS/269T of the Act. In the present cases, the A…

Asstt. CIT CC 7(3), Mumbai vs. M/S. Macrotech Developers Ltd. (Earlier Known As M/S Palava Dwellers P. Ltd.), Mumbai

In the result, appeal filed by the revenue is dismissed

Bench: Shri Aby T Varkey & Shri S Rifaur Rahmanassessment Year: 2015-16 Assistant Commissioner Of M/S Macrotech Developers Ltd., Income Tax, Cc-7(3), Mumbai, (Earlier Known As M/S Palava Room No. 655, Dwellers Pvt. Ltd.), Aaykar Bhavan, M.K. Road, Vs. 412, Vardhan Chambers, Mumbai - 400020 Cawasji Patel Street, Fort, Mumbai - 400001 Pan: Aabcl1117D (Appellant) (Respondent) Revenue By : Shri Mehul Jain (Dr) Assessee By : Shri Niraj Sheth (Ar) Date Of Hearing : 21/04/2022 Date Of Pronouncement: 03/06/2022

…IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES “A”, MUMBAI BEFORE SHRI ABY T VARKEY, JUDICIAL MEMBER AND SHRI S RIFAUR RAHMAN, ACCOUNTANT MEMBER Assessment Year: 2015-16 Assistant Commissioner of M/s Macrotech Developers Ltd., Income Tax, CC-7(3), Mumbai, (Earlier known as M/s Palava Room No. 655, Dwellers Pvt. Ltd.), Aaykar Bhavan, M.K. Road, Vs. 412, Vardhan Chambers, Mumbai - 400020 Cawasji Patel Street, Fort, Mumbai - 400001 PAN: AABCL1117D (Appellant) (Respondent) Revenue by : Shri Mehul Jain (DR) Assessee by : Shri Niraj Sheth (AR) Date of Hearing : 21/04/2022 Date of Pronouncement: 03/06/2022 O R D…

ITO - 1(2)(2), Mumbai vs. M/S Laquilla Investments Co. Pvt. Ltd, Mumbai

In the result, both the appeals filed by the Revenue are dismissed

Bench: Shri Aby T. Varkey () & Shri S.Rifaur Rahman ()

…ded that the penalty may not be levied under section 271E. However, the assessing officer did not accept the submissions of the assessee by relying upon the decision of the Hon’ble jurisdictional High Court in the case of Triumph International Finance Pvt Ltd 345 ITR 270 that even the journal entry to show repayment of loan will be in contravention of section 269T of the Act. Further, according to the assessing officer, even section 273 of the Act would not come to the rescue of the assessee because the assessee failed to show that there existed a reasonable cause or compulsion for the failure to adhere to the pr…

DCIT CC-7(3), Mumbai vs. M/S Macrotech Developers Ltd. (Earlier Known As M/S. Lodha Developers Ltd), Mumbai

In the result, appeals filed by the Revenue are dismissed

Bench: Shri Amarjit Singh, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

…ictional High Court, in the absence of these findings in the assessment order, the penalty levying authority should presume that there is presence of reasonable cause u/s.273B. f) A much later decision of the Delhi High Court in the case of Worldwide Township 345 ITR 270 (Del.) held that transfer of receivables and payables by journal entries during the course of normal business shall not fall in the ambit of Sec.269SS/T, since such transfers do not involve money or currency. The said decision of Delhi High Court has been accepted by the CBDT and no SLP has been filed. This is evident from the circular no.10 of 2…

DCIT CC-7(3), Mumbai vs. M/S Macrotech Developers Ltd. (Earlier Konwn As to M/S.Lodha Developers Ltd), Mumbai

In the result, appeals filed by the Revenue are dismissed

Bench: Shri Amarjit Singh, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

…ictional High Court, in the absence of these findings in the assessment order, the penalty levying authority should presume that there is presence of reasonable cause u/s.273B. f) A much later decision of the Delhi High Court in the case of Worldwide Township 345 ITR 270 (Del.) held that transfer of receivables and payables by journal entries during the course of normal business shall not fall in the ambit of Sec.269SS/T, since such transfers do not involve money or currency. The said decision of Delhi High Court has been accepted by the CBDT and no SLP has been filed. This is evident from the circular no.10 of 2…

DCIT Cen Cir 7(3), Mumbai vs. M/S Sahajanand Hi Tech Construction P.Ltd, Mumbai

Accordingly, the grounds raised by the Revenue are dismissed

Bench: Sri Prashant Maharishi, Am & Sri Sandeep Singh Karhail, Jm

…Constructions Pvt. Ltd. Therefore, adjustment was given effect by way of a journal entry. 3.3. The ld. CIT(A) placed reliance on the decision of the Hon‟ble Jurisdictional High Court in the case of CIT vs. Triumph International (I) Finance Ltd., reported in 345 ITR 270 wherein it was held that the transactions through journal entries are also hit by the provisions of 269SS and 269T of the Act. The decision of the Hon‟ble Bombay High Court rendered on 12/06/2012 is significant and prior to this judgment, there were series of consistent decisions on Sections 269SS and 269T of the Act holding that mere passing of…

DCIT Cen Cir 7(3), Mumbai vs. M/S Sahajanand Hi Tech Construction P.Ltd, Mumbai

Accordingly, the grounds raised by the Revenue are dismissed

Bench: Sri Prashant Maharishi, Am & Sri Sandeep Singh Karhail, Jm

…Constructions Pvt. Ltd. Therefore, adjustment was given effect by way of a journal entry. 3.3. The ld. CIT(A) placed reliance on the decision of the Hon‟ble Jurisdictional High Court in the case of CIT vs. Triumph International (I) Finance Ltd., reported in 345 ITR 270 wherein it was held that the transactions through journal entries are also hit by the provisions of 269SS and 269T of the Act. The decision of the Hon‟ble Bombay High Court rendered on 12/06/2012 is significant and prior to this judgment, there were series of consistent decisions on Sections 269SS and 269T of the Act holding that mere passing of…

DCIT Cen Cir 7(3), Mumbai vs. Sanathanagar Enterprises Ltd, Mumbai

In the result, all the appeals of the Revenue are dismissed and all Cross Objections of the assessee are allowed

…al and decision of the Hon‟ble Delhi High Court in support of its contentions. The Addl. CIT however, relied on the decision of the Hon‟ble Jurisdictional High Court in the case of CIT vs. Triumph International Finance India Ltd., dated 12/06/2012 reported in 345 ITR 270 wherein loan / deposits has been repaid by debiting the account through journal entries, it must be held that the assessee had contravened the provisions of Section 269T of the Act. The Addl. CIT also observed that the case before the Hon‟ble Bombay High Court in Triumph International Finance (I) Ltd., involved transaction with one party and acco…

DCIT (CC) 7(3), Mumbai vs. M/S Bellissimo Cown Buildmart P. Ltd, Mumbai

1. 3038/Mum/2019 2014-15

…Constructions Pvt. Ltd. Therefore, adjustment was given effect by way of a journal entry. 3.3. The ld. CIT(A) placed reliance on the decision of the Hon‟ble Jurisdictional High Court in the case of CIT vs. Triumph International (I) Finance Ltd., reported in 345 ITR 270 wherein it was held that the transactions through journal entries are also hit by the provisions of 269SS and 269T of the Act. The decision of the Hon‟ble Bombay High Court rendered on 12/06/2012 is significant and prior to this judgment, there were series of consistent decisions on Sections 269SS and 269T of M/s. Macrotech Developers Pvt. Ltd.,…

DCIT CC 7(3), Mumbai vs. M/S Palava Dwellers Pvt. Ltd., Mumbai

Bench: Shri Pramod Kumar () & Shri Ravish Sood () Ita Nos.3050 & 3051/Mum/2019 (Assessment Year: 2014-15 ) D.C.I.T, Cc-7(3), M/S Palava Dwellers Pvt. Ltd. Room No. 655, 6Th Floor, Vs. 412, Vardhman Chambers, Aaykar Bhavan, M.K. Road, Cawasji Patel Street, Mumbai – 400 020 Horniman Circle Fort, Mumbai – 400 001 Pan No. Aabcl1117D (Revenue) (Assessee) Assessee By : Shri Neraj Sheth, A.R Revenue By : Ms. Shreekala Pardeshi, D.R Date Of Hearing : 06/10/2021 Date Of Pronouncement : 11/10/2021 Order Per Ravish Sood, J.M: The Captioned Appeals Filed By The Revenue Are Directed Against The Respective Orders Passed By The Cit(A)-49, Mumbai, Dated 12.02.2019, Which In Turn Arises From The Respective Orders Passed By The Additional Commissioner Of Income Tax, Central Range-7, Mumbai (For Short ―Addl. Cit‖) Under Sec. 271D & Sec. 271E Of The Income-Tax Act, 1961 (For Short ―Act‖), Dated 29.06.2017 For A.Y. 2014-15. As The Issues Involved In The Aforementioned Appeals Are Interwoven Or In Fact Intertwined, Therefore, The Same Are Being Taken Up & Disposed Off By Way Of A Consolidated Order. The Revenue Has Assailed The Impugned Order On The Following Grounds Before Us: ―1. Whether On The Facts & Circumstances Of The Case & In Law, The Hon‘Ble Cit(A) Is Justified In Deleting The Penalty Of Rs.1,99,68,616/- U/S 271D Holding That There Was Reasonable Cause U/S 273B For Entering On Transaction To Transaction Basis In The Given Case For The Existence Of Reasonable Cause U/S 273B Which Led To The Exigency Of Contravention Of Provisions Of Sections 269Ss/St.

…of the Act no penalty could be imposed u/s 271D of the Act, it was observed by the Addl. CIT that the said contention was contrary to the view taken by the Hon‘ble jurisdictional High Court in the case of CIT Vs. Triumph International Finance (I) Ltd. (2012) 345 ITR 270 (Bom). Although, it was the claim of the assessee that the transactions in question were genuine and made by the lender companies to the third parties on the behalf of the assessee due to business expediency/necessity, however, it was observed by the Add.CIT that the assessee had failed to demonstrate any such business expediency. Observing, that…

DCIT Cen Cir 7(3), Mumbai vs. Macrotech Construction P.Ltd, Mumbai

In the result , both the appeals of the revenue are dismissed

…e belief was based on the series of judicial pronouncements laying down the above proposition. However, subsequently, on 12-06-2012, the Hon’ble Jurisdictional High Court rendered a decision in the case of Triumph International Finance (India) Limited (2012) [345 ITR 270]wherein it was held that the transactions through journal entries are also hit by the provisions of section 269SS and 269T of the Act. The decision of Hon’ble Bombay High Court rendered on 12.6.2012 is the significance of that date. Hence prior to the judgement of the Hon’ble Bombay High Court in the case of Triumph International Finance (India)…

M/S. Vijay Steel Corporation Pvt. Ltd., Mumbai vs. ACIT, Range-13(3), Mumbai

In the result, appeals are allowed

Bench: Shri Saktijit Dey & Shri N.K. Pradhan

…g and re–payment of loan through book entries without involvement of any cash transaction can at all attract the provisions of section 269SS and 269T of the Act. The Hon'ble Jurisdictional High Court in CIT v/s Triumph International Finance India Ltd., [2012] 345 ITR 270 (Bom.), has held that availing and re– 5 M/s. Vijay Steel Corporation Pvt. Ltd. payment of loan through book/journal entries would attract provisions of section 269SS and 269T of the Act. However, the aforesaid legal proposition has been further clarified by the Hon'ble Jurisdictional High Court in CIT v/s Ajitnath High–Tech Builders Pvt. Ltd.…

DCIT Cen Cir 7(3), Mumbai vs. Vardhvinayak Township Development P. Ltd, Mumbai

In the result, the appeal of Revenue is dismissed

Bench: Shri Pawan Singh & Shri S. Rifaur Rahman

…mal course of business has been doubted in the regular assessment and there is a reasonable cause exist in the case of the assessee because in view of the decision of Hon'ble Bombay High Court in the case of CIT Vs Triumph International Finance (I) Ltd (2012) 345 ITR 270 (Bom.), the same was delivered only on 12.06.2012 and on that date Hon'ble Bombay High Court has clarified the position that the receiving of deposits or loans through journal entries would certainly be hit by the provisions of section 269SS and 269T of the Act. According to CIT(A), prior to the decision of Hon'ble Bombay High Court in the case o…

DCIT Cen Cir 7(3), Mumbai vs. Lodha Home Developers P.Ltd, Mumbai

In the result, all the appeals filed by the Revenue are dismissed and cross objections filed by the assessee are allowed

Bench: Shri C.N. Prasad, Hon'Ble & Shri Rajesh Kumar, Hon'Ble

…us are agreed that the Tribunal was correct in holding that receipt of any advance / loan by way of journal entries is in breach of Section 269SS of the Act as the decision of this Court in Commissioner of Income Tax Vs. Triumph International Finance (I) Ltd. 345 ITR 270 is binding upon it. However, the Revenue's grievance is with the impugned order dated 27th June, 2014 of the Tribunal further holding no penalty under Section 271D of the Act is imposable in view of Section 273B of the Act in the present facts. This is so as the Tribunal holds that the failure to comply with Section 269SS of the Act was on accoun…