R.K. & CO. P. LTD, MUMBAI v. ADDL CIT 7(2), MUMBAI

ITA 2218/MUM/2012 | 2005-2006
Pronouncement Date: 31-07-2013 | Result: Allowed

Appeal Details

RSA Number 221819914 RSA 2012
Assessee PAN AACCR3695P
Bench Mumbai
Appeal Number ITA 2218/MUM/2012
Duration Of Justice 1 year(s) 3 month(s) 27 day(s)
Appellant R.K. & CO. P. LTD, MUMBAI
Respondent ADDL CIT 7(2), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 31-07-2013
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted D
Tribunal Order Date 31-07-2013
Date Of Final Hearing 29-07-2013
Next Hearing Date 29-07-2013
Assessment Year 2005-2006
Appeal Filed On 03-04-2012
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D MUMBAI .. ! ' # $ ' % BEFORE SHRI R.S.SYAL AM AND SHRI VIVEK VARMA JM ITA NO.2218/MUM/2012 : ASST.YEAR 2005-2006 M/S.R.K. & CO. PVT. LTD. 1 KAMDAR SHOPPING CENTRE TEJPAL ROAD VILE PARLE (EAST) MUMBAI 400 057. PAN :AACCR3695P THE ADDL.COMMISSIONER OF INCOME-TAX RANGE 7(2) MUMBAI. ( &' / // / APPELLANT) ) ) ) ) / VS. ( *+&'/ RESPONDENT) &' - - - - / APPELLANT BY : SHRI S.S.PHADKAR *+&' - - - - / RESPONDENT BY : SHRI KISHAN VYAS ) .! / / / / DATE OF HEARING : 29.07.2013 /01 .! / DATE OF PRONOUNCEMENT : 31.07.2013 ' 2 ' 2 ' 2 ' 2 / / / / O R D E R PER R.S.SYAL (AM) : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON 28.1 2.2011 UPHOLDING PENALTY OF ` 2 50 000 IMPOSED BY THE ASSESSING OFFICER U/S 271D OF THE ACT IN RELATION TO THE ASSESSMENT YEAR 2005-2006. 2. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE RECEIVED CASH LOANS OF ` 1 00 000 FROM SHRI RAJESH P.KAMDAR AND ` 1 50 000 FROM SHRI NITIN P.KAMDAR ON 30.11.2004. THE ASSESSI NG OFFICER OBSERVED THAT THERE WAS A VIOLATION OF PROVISIONS O F SECTION 269SS WARRANTING PENALTY U/S 271D OF THE ACT. RESULTANTLY THE SAID PENALTY OF ` 2.50 LAKH WAS IMPOSED. IT WAS CONTENDED BEFORE THE LD. FIRST APPELLATE AUTHORITY THAT THE CASH LOANS WERE TAKEN FOR MAKING ITA NO.2218/MUM/2012. M/S.R.K.& CO.PVT. LTD. 2 PAYMENT OF ` 13.76 LAKH FOR PURCHASE OF TDRS AS PER THE AGREEMEN T OF PURCHASE WITH M/S.PRANAV INVESTMENT. IN THE ABSENCE OF SUCH PAYMENT THE TRANSACTION ITSELF WOULD HAVE FALLEN CAUSING IRREPARABLE LOSS TO THE BUSINESS. IT WAS EXPLAINED THAT THE CHE QUE DATED 22.11.2004 WAS ISSUED TO M/S.PRANAV INVESTMENT FOR ` 13.76 WHICH WOULD NOT HAVE BEEN CLEARED WITHOUT THE RECEIPT OF ABOVE SAID LOANS IN CASH. THE LEARNED CIT(A) DID NOT AGREE WITH THE CONTENTION ADVANCED ON BEHALF OF THE ASSESSEE AND UPHELD THE P ENALTY. 3. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PERU SING THE RELEVANT MATERIAL ON RECORD IT IS NOTICED THAT THE RECEIPT OF LOANS IN CASH BEYOND THE MONETARY LIMIT PRESCRIBED U/S 269SS CALLS FOR IMPOSITION OF PENALTY U/S 271D. HOWEVER THE PENALTY U/S 271D IS NOT ABSOLUTE INASMUCH AS SECTION 273B PROVIDES THAT NO PENALTY INTER ALIA U/S 271D SHALL BE IMPOSED IF THERE IS REASONABLE CA USE FOR THE VIOLATION ATTRACTING SUCH PENALTY. 4. ADVERTING TO THE FACTS OF THE INSTANT CASE IT IS NOTICED THAT THE ASSESSEE RECEIVED THESE LOANS IN CASH ON 30.11.2004 THEREBY VIOLATING THE PROVISIONS OF SECTION 269SS. HOWEVER THESE CASH LOANS WERE TAKEN BECAUSE THE ASSESSEE HAD ISSUED CHEQUE TO M/S .PRANAV INVESTMENT TOWARDS INSTALLMENT OF ` 13.76 LAKH FOR PURCHASE OF TDR. SUCH CHEQUE DATED 22.11.2004 WAS CLEARED ON 07.12.2 004 I.E. AFTER THE RECEIPT OF THE ABOVE SAID LOANS IN CASH AND DEP OSITING THE SAME INTO THE ASSESSEES BANK ACCOUNT. IN OUR CONSIDERED OPINION THE SAID LOANS OF ` 2.50 LAKH WERE RECEIVED FOR MEETING BUSINESS EXIGEN CY AND THERE WAS A REASONABLE CAUSE IN ACCEPTING THE SAID LOANS IN CASH. BUT ITA NO.2218/MUM/2012. M/S.R.K.& CO.PVT. LTD. 3 FOR SUCH LOANS OF ` 2.50 LAKH IN CASH THE CHEQUE ISSUED TO M/S.PRANAV INVESTMENT FOR PURCHASE OF TDRS WOULD NOT HAVE BEEN ENCASHED. WE THEREFORE FIND THAT THERE WAS A REASONABLE CAUSE I N ACCEPTING THESE LOANS IN CASH THEREBY BRINGING THE CASE WITHIN THE PURVIEW OF SECTION 273B CALLING FOR DELETION OF PENALTY WHICH WOULD H AVE BEEN OTHERWISE IMPOSABLE U/S 271D. WE THEREFORE OVERTUR N THE IMPUGNED ORDER AND ORDER FOR THE DELETION OF PENALTY. 5. 3 .4 5 6 . 7. 89 IN THE RESULT THE APPEAL IS ALLOWED. ORDER PRONOUNCED ON THIS 31 ST DAY OF JULY 2013. ' 2 /01 :')4 0 ; SD/- SD/- (VIVEK VARMA) (R.S.SYAL) $ ' $ ' $ ' $ ' / JUDICIAL MEMBER ! ' ! ' ! ' ! ' / ACCOUNTANT MEMBER MUMBAI ; :') DATED : 31 ST JULY 2013. DEVDAS* ' 2 *$.<# = #1. ' 2 *$.<# = #1. ' 2 *$.<# = #1. ' 2 *$.<# = #1./ COPY OF THE ORDER FORWARDED TO : 1. &' / THE APPELLANT 2. *+&' / THE RESPONDENT. 3. > () / THE CIT THANE. 4. > / CIT(A) 13 MUMBAI. 5. #A; *$.$) / DR ITAT MUMBAI 6. ; B / GUARD FILE. ' 2) ' 2) ' 2) ' 2) / BY ORDER +#. *$. //TRUE COPY// C C C C/ // /8 7 8 7 8 7 8 7 ( DY./ASSTT. REGISTRAR) / ITAT MUMBAI