VIJAY SHARMA, Jaipur v. ADD. CIT, Jaipur

ITA 675/JPR/2016 | 2008-2009
Pronouncement Date: 18-10-2016 | Result: Allowed

Appeal Details

RSA Number 67523114 RSA 2016
Assessee PAN BGAPS8888P
Bench Jaipur
Appeal Number ITA 675/JPR/2016
Duration Of Justice 3 month(s) 24 day(s)
Appellant VIJAY SHARMA, Jaipur
Respondent ADD. CIT, Jaipur
Appeal Type Income Tax Appeal
Pronouncement Date 18-10-2016
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted Not Allotted
Tribunal Order Date 18-10-2016
Assessment Year 2008-2009
Appeal Filed On 24-06-2016
Judgment Text
VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCHES (SMC) JAIPUR JH HKKXPUN] YS[KK LNL; DS LE{K BEFORE: SHRI BHAGCHAND ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 675/JP/2016 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2008-09 SHRI VIJAY SHARMA B-140 HARI MARG MALVIYA NAGAR JAIPUR CUKE VS. THE ADDL. CIT RANGE-6 JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: BGAPS 8888 P VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY: SHRI VIJAY GUPTA CA JKTLO DH VKSJ LS@ REVENUE BY :SHRI R.A. VERMA ADDL CIT-. DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 10/10/2016 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 18 /10/2016 VKNS'K@ ORDER PER BHAGCHAND AM THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDER OF THE LD. CIT(A)-5 JAIPUR DATED 13-10-2016 FOR THE ASSESSM ENT YEAR 2008-09 RAISING THEREIN FOLLOWING GROUNDS:- THE LD. CIT(A) HAS ERRED IN LAW AND IN FACTS IN UPHOLDING LEVY OF PENALTY LEVIED BY ADDL. CIT RANGE-6 WITHOUT TAK ING INTO CONSIDERATION THAT :- (1) THE TRANSACTION OF RECEIPT OF FUNDS IS GENUINE AND THERE STANDS NO TAX EVASION EVEN IF THE TRANSACTION IS MA DE IN CASH. ITA NO. 675/JP/2016 SHRI VIJAY SHARMA VS. ADDL. CIT RANGE-6 JAIPUR . 2 (2) THERE IS ONLY TECHNICAL AND VENIAL BREACH OF L AW FOR A BONAFIDE TRANSACTION. (3) THE APPELLANT WAS UNDER BONAFIDE BELIEF THAT T HE TRANSACTION BELOW RS. 20 000/- IN CASH IS NOT AGAIN ST THE LAW. (4) THERE IS TRANSFER OF FUNDS BETWEEN SISTER CON CERN/CLOSE RELATIVES FOR BUSINESS EXIGENCY WHICH CANNOT BE CO NSTRUED AS LOAN OR DEPOSIT. (5) THE ASSESSEE HAS TAKEN FUNDS DUE TO BUSINESS EXIGENCY. (6) THE PENALTY WAS LEVIED ON THE BASIS OF SURMISE S AND CONJECTURE ONLY WITHOUT REFERRING TO FACTS OF THE M ATTER. 2.1 BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE H AD FILED HIS RETURN OF INCOME DECLARING TOTAL INCOME OF RS. 2 10 780/- FOR THE ASSESSMENT YEAR 2008-09. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY. ACCORDINGLY THE ASSESSMENT U/S 143(3) OF THE ACT WAS COMPLETED BY THE AO AT AN INCOME OF RS. 2 86 670/- ON 18-11-2010. THE AO DURI NG THE COURSE OF ASSESSMENT PROCEEDINGS OBSERVED THAT THE ASSESSEE H AD ACCEPTED LOANS IN CASH AMOUNTING TO RS. 2.50 LACS FROM SMT. DHAPA DEV I RS. 50 000/- FROM SMT. BHAGWATI DEVI AND RS. 1.50 LACS FROM SHRI LAL CHAND SHARMA TOTALING TO RS. 4.50 LACS. THE AO FURTHER OBSERVED THAT THE ASSESSEE ACCEPTED TOTAL AMOUNT OF RS. 4.50 LACS OTHERWISE TH AN BY AN ACCOUNT PAYEE CHEQUE OR ACCOUNT PAYEE BANK DRAFT AGAINST LO AN IN CONTRAVENTION TO PROVISIONS OF SECTION 269SS OF THE I.T. ACT. THE AO THUS VIDE HIS LETTER ITA NO. 675/JP/2016 SHRI VIJAY SHARMA VS. ADDL. CIT RANGE-6 JAIPUR . 3 DATED 25-04-2011 REFERRED THE CASE TO INITIATE PENA LTY PROCEEDINGS U/S 271D OF THE ACT IN TERMS OF PROVISIONS OF SECTION 2 71D(2). THE ADDL. CIT RANGE-6 JAIPUR TOOK INTO CONSIDERATION ALL TH E FACTUAL ASPECTS OF THE CASE INCLUDING THE ARGUMENTS OF THE ASSESSEE IMPOSE D THE PENALTY VIDE HIS ORDER DATED 28-10-2011 OF RS. 4.50 LACS U/S 271D B Y OBSERVING AS UNDER:- 3.1 3.2 THUS THE ASSESSEE CLEARLY VIOLATED THE PROVIS IONS OF SECTION 269SS AND RESULTANTLY ATTRACTING THE PEN ALTY PROVISIONS OF SECTION 271D OF THE ACT IN RESPECT OF THE LOANS ACCEPTED OTHERWISE THAN BY ACCOUNT PAYEE CHEQUE OR ACCOUNT PAYEE BANK DRAFT AGAINST LOANS FROM SMT. DHAPA DEVI SMT. BHAGWATI DEVI AND SHRI LAL CHAND SHARMA AMOUNTING T O RS. 2 50 000/- RS. 50 000/-AND RS. 1 50 000/-RESPECTIV ELY WHICH TOTAL TO RS. 4 50 000/- IN CONTRAVENTION TO PROVISI ONS OF SAID SECTION OF THE ACT. 3.3 IN VIEW OF THE ABOVE DISCUSSION I AM SATISFIED THAT THE ASSESSEE HAS VIOLATED THE PROVISIONS OF SE CTION 269SS BY ACCEPTING THE LOANS FROM AFORESAID PERSONS IN CASH I.E. OTHERWISE THAN BY ACCOUNT PAYEE CHEQUE OR ACC OUNT PAYEE BANK DRAFT AGAINST LOAN. 3.4 HENCE IN VIEW OF ABOVE FACTS IT IS A FIT CASE FOR LEVY OF PENALTY U/S 271D FOR ACCEPTANCE OF LOANS I N CASH IN CONTRAVENTION TO THE PROVISION OF SECTION 269SS WIT HOUT ANY REASONABLE AND JUSTIFIABLE CAUSE. THEREFORE I HERE BY IMPOSE A PENALTY OF RS. 4 50 000/- U/S 271D OF THE I.T. AC T 1961. 2.2 BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTE R BEFORE THE LD. CIT(A) WHO HAD CONFIRMED THE PENALTY U/S 271D IMPOS ED BY THE AO BY OBSERVING AS UNDER:- ITA NO. 675/JP/2016 SHRI VIJAY SHARMA VS. ADDL. CIT RANGE-6 JAIPUR . 4 2.3 I HAVE CONSIDERED THE PENALTY ORDER U/S 271D SUBMISSIONS OF THE APPELLANT AND FACTS OF THE CASE. THE APPELLANT HAS BORROWED AMOUNTS OF RS. 2 50 000/- FROM HIS GRA NDMOTHER SMT. DHUPA DEVI RS. 50 000/- FROM HIS MOTHER SMT. BHAGWATI DEVI AND RS. 1 50 000/- FROM SHRI LAL CHAND HIS UN CLE. THE SAID AMOUNTS HAVE BEEN BORROWED IN CASH OVER A PERIOD FR OM 10-08- 2007 TO 18-02-2008 AND THE AMOUNTS BORROWED ON EACH OCCASION ARE JUST BELOW RS. 20 000/-. THE APPELLANT HAS TAKE N THREE BASIC ARGUMENTS AGAINST THE LEVY OF PENALTY VIZ (I) THE A PPELLANT WAS UNDER BONAFIDE BELIEF THAT TRANSACTIONS BELOW RS. 2 0 000/- IN CASH IS NOT AGAINST LAW (II) TRANSFER OF FUNDS IS BETWE EN NEAR RELATIVE WHICH CANNOT BE CONSTRUED AS LOAN OR DEPOSIT AND (I II) THE FUNDS ARE TAKEN DUE TO BUSINESS EXIGENCY AND THE TRANSACTIONS ARE GENUINE. 2.4 REGARDING THE FIRST PLEA OF THE APPELLANT RELAT ING TO BONA FIDE BELIEF IT IS WIDELY ACCEPTED THAT IGNORA NCE OF LAW IS NO EXECUSE FOR VIOLATING THE LAW. FURTHER THE APPELLA NT HAS BEEN UNABLE TO ESTABLISH INNOCENCE CONSIDERING THE FACT THAT HE IS CONVERSANT WITH PROVISIONS OF LAW TO THE EXTENT OF THAT HE HAS AVOIDED TAKING SUMS OF ABOVE OF RS. 20 000/- PRIMAR ILY BECAUSE OF HIS AWARENESS OR AT LEAST PART AWARENESS OF THE PRO VISIONS OF SECTION 269SS AND SECTION 271D. MOREOVER THE APPEL LANT CASE IS AUDITED U/S 44AB AND HE IS REGULARLY FILING RETURNS WHICH SHOWS THAT HE HAS ACCESS TO THE ADVICE OF CAS/ TAX PRACTI TIONERS. THUS HIS CLAIM REGARDING THE IGNORANCE OF LAW IS UNACCEPTABL E. 2.5 THE NEXT ARGUMENT OF THE APPELLANT IS THAT THE TRANSACTION IS WITH NEAR RELATIVES WHICH CANNOT BE CONSTRUED AS LOAN OR DEPOSIT. IT IS HOWEVER OBSERVED THAT THE A PPELLANT HAS HIMSELF TREATED SUCH RECEIPTS AS LOAN IN HIS BOOKS OF ACCOUNT THEREFORE HE CANNOT TREAT IT OTHERWISE AS PER HIS CONVENIENCE. FURTHER THE MONEY RECEIVED IS ADMITTEDLY NOT A GIF T AND THE SAME HAS BEEN RETAINED FOR A RELATIVELY LONG DURATION T HEREBY SHOWING ALL CHARACTERISTICS OF LOAN/ DEPOSITS. THE WORDINGS OF SECTION 269SS ARE WIDE ENOUGH TO COVER SUCH TRANSACTIONS IN THE A MBIT OF LOAN/ DEPOSIT. MOREOVER THE PROVISIONS OF SECTION 269SS AND SECTION 271D DO NOT EXEMPT NEAR RELATIVES FROM THE PURVIEW OF THESE SECTIONS. ALL EXCEPTIONS TO THE SAID PROVISIONS ARE LAID DOWN SPECIFICALLY IN THOSE PROVISIONS ITSELF AND THERE I S NO SUCH EXCEPTION PROVIDED FOR TRANSACTIONS WITH NEAR RELATIVES. ITA NO. 675/JP/2016 SHRI VIJAY SHARMA VS. ADDL. CIT RANGE-6 JAIPUR . 5 2.6 REGARDING THE AMOUNT OF BUSINESS EXIGENCY IT I S NOTEWORTHY THAT THE RECEIPTS OF CASH LOANS ARE ACRO SS A PERIOD EXCEEDING SIX MONTHS. A BUSINESS EXIGENCY IS UNDERS TANDABLE FOR ONE OCCASION OR FOR RELATIVELY SHORT SPANS OF TIME DURING WHICH IT MAY NOT BE POSSIBLE TO OPEN BANK ACCOUNTS OF CONCER NED RELATIVES AND CONSEQUENTLY TRANSACT THROUGH CHANNELS. 6 MONTH S IS ALONG ENOUGH DURATION FOR THE APPELLANT TO REALIZE THE ON GOING CONTRAVENTION OF PROVISIONS OF LAW AND TO AMEND SUC H FLAWED SITUATION. BUSINESS EXIGENCY CANNOT BE ADOPTED AS A SHIELD TO CARRY OUT CONTRAVENTION OF LAW FOR SUCH LENGTHS OF TIME. THE CASE OF CIT VS. RAJKUMAR SHARMA CITED BY THE APPELLANT IS DISTI NGUISHABLE FROM THAT OF THE APPELLANT ON THIS ACCOUNT. IN THE SAID CASE THE TRANSACTIONS WERE FOR ONE AND A HALF MONTH ONLY WH EREAS IN THE APPELLANTS CASE IT SPANS MORE THAN SIX MONTHS. THE MOOT QUESTION WHICH ARISE HERE IS AS TO WHETHER BUSINESS EXIGENCY CAN BE TAKEN AS REASONABLE CAUSE FOR CONTRAVENING PROVISIONS OF SEC TION 269SS REPEATEDLY AND FOR INDEFINITE LENGTHS OF TIME? THE LOGICAL AD OBVIOUS ANSWER AS WELL AS THE THREE CREDITORS ARE R ESIDENTS OF URBAN AREA OF JAGATPURA IN JAIPUR CITY WHICH IS FULLY SER VICED BY BANKS. THE APPELLANT HIMSELF AVAIL BANKING FACILITIES IN S UCH A SITUATION THE APPELLANT SHOULD HAVE PROMPTLY GOT BANK ACCOUNT S OF SUCH NEAR RELATIVES OPERATIONAL. SECTION 269SS PROVIDES EXEMP TION FROM USE OF BANKING CHANNELS IN ONLY THOSE CASES WHERE BOTH CREDITOR AND BORROWER ARE AGRICULTURISTS AD NEITHER OF THEM HAS ANY INCOME CHARGEABLE TO TAX. THIS IS OBVIOUSLY NOT THE CASE O F THE APPELLANT. FURTHER PROVISIONS OF SECTION 269SS AND SECTION 27 1D WERE ENACTED TO CURB CASH TRANSACTIONS IN THE ECONOMY OR OTHERWISE OF THE IMPUGNED TRANSACTIONS. THUS THE PLEA REGARDING TRANSACTIONS BEING GENUINE ALSO DOES NOT HOLD GOOD. CONSIDERING THE FACTS OF THE CASE IT IS HEREBY HELD THAT THE APPELLANT HAS CONT RAVENED THE PROVISIONS OF SECTION 269SS AND SECTION 271D WITHOU T ANY REASONABLE CAUSE. THE CONSEQUENTLY LEVY OF PENALTY U/S 271D IS ACCORDINGLY CONFIRMED. 2.3 THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL A GAINST THE ORDER OF THE LD. CIT(A) FOR CONFIRMING PENALTY U/S 271D OF T HE ACT. DURING THE COURSE OF HEARING THE LD. AR OF THE ASSESSEE PRAYE D FOR DELETION OF ITA NO. 675/JP/2016 SHRI VIJAY SHARMA VS. ADDL. CIT RANGE-6 JAIPUR . 6 PENALTY CONFIRMED BY THE LD. CIT(A) FOR WHICH THE L D. AR OF THE ASSESSEE FILED THE WRITTEN SUBMISSION AS UNDER:- 3.1 IT HAS NOT BEEN DISPUTED THAT PAYMENTS / LOA N TRANSACTIONS WERE GENUINE AND DULY REFLECTED IN THE BOOKS OF ASSESSEE. NO MALAFIDE ABOUT THE TRANSACTION IS ATTR IBUTED OR PROVED BY THE LOWER AUTHORITIES AND ASSESSEE'S FACTUAL EXP LANATION HAS BEEN REJECTED WITHOUT COGENT REASONS. 3.2 RELIANCE IS PLACED BY THE HON'BLE JURISDICTIO NAL HIGH COURT IN THE CASE OF CIT VS. RAJ KUMAR SHARMA 294 ITR 131 WHERE THE HON'BLE HIGH COURT REJECTED THE CONTENTIO N OF REVENUE AND DELETED PENALTY U/S 271D AFTER OBSERVING AS UND ER:- WE ARE NOT PERSUADED BY THE SUBMISSION OF COUNSEL FOR THE REVENUE. SECTION 271D OF THE INCOME TAX ACT PROVIDES FOR PEN ALTY FAILURE TO COMPLY WITH THE PROVISIONS OF SECTION 26 9SS OF THE INCOME-TAX ACT. ACCORDING TO THIS PROVISION IF A P ERSON INTER ALIA ACCEPTS ANY LOAN IN CONTRAVENTION OF THE PROVISIONS OF SECTION 269SS OF THE INCOME-TAX ACT HE SHALL BE LIABLE TO PAY BY WAY OF PENALTY A SUM OF EQUAL TO THE AMOUNT OF LOAN OR DE POSIT SO TAKEN OR ACCEPTED. SECTION 273B IS AN OVERRIDING PROVISION. ACCORDING TO THE SAID PROVISION NO PENALTY SHALL BE IMPOSABLE O N A PERSON OR ASSESSEE FOR ANY FAILURE INTER ALIA REFERRED TO S ECTION 271D IF HE PROVES THAT THERE WAS REASONABLE CAUSE FOR THE SAID FAILURE . THE TRIBUNAL IN ITS ORDER HAS FOUND THAT THE GENUINENES S OF THE DEPOSITS MADE BY THE ASSESSEE'S BROTHER PANKAJ SHARMA WAS NO T IN DOUBT BY THE ASSESSING OFFICER. THE TRIBUNAL NOTICED THAT EX PLANATION GIVEN BY THE ASSESSEE THAT THE DEPOSITS WERE OBTAINED BY HIM TO SATISFY THE IMMEDIATE BUSINESS REQUIREMENT BUT FOUND THAT THIS HAS NOT BEEN ESTABLISHED. HOWEVER THE TRIBUNAL WAS THUS OF THE VIEW THAT THERE WAS A REASONABLE CAUSE TO ACCEPT THE DEPOSIT OTHERW ISE THROUGH BANK DRAFT OR THROUGH CHEQUE BECAUSE THE ASSESSEE B ONA FIDE BELIEVED THAT THE CASH TRANSACTIONS BELOW RS. 20 00 0/- WAS PERMISSIBLE. ITA NO. 675/JP/2016 SHRI VIJAY SHARMA VS. ADDL. CIT RANGE-6 JAIPUR . 7 IT IS TRUE THAT THE IGNORANCE OF LAW IS NO EXCUSE BUT THE QUESTION HERE IS WHETHER THE ASSESSEE WAS ABLE TO E STABLISH REASONABLE CAUSE U/S 273B JUSTIFYING THAT NO PENALT Y SHOULD BE IMPOSED IN CONTRAVENTION OF SECTION 271D OF THE INC OME-TAX ACT. NONE OF THE TRANSACTIONS EXCEEDS AS NOTICED ABOVE RS. 20 000/-. THE TRIBUNAL ACCEPTED THAT THE ASSESSEE BONA FIDE B ELIEVED THAT THE CASH TRANSACTION BELOW RS. 20 000/- WAS PERMISSIBLE AND THE CAUSE SHOWN BY THE ASSESSEE CONSTITUTED REASONABLE CAUSE. THE FINDING OF THE TRIBUNAL CANNOT BE SAID TO BE GROSSLY PERVERSE OR UNSUSTAINABLE IN LAW. IN OUR CONSIDERED VIEW THE APPEAL DOES NOT GIVE RISE TO ANY SUBSTANTIAL QUESTION OF LAW. IT IS DISMISSED IN LIM INE. 3.3 FURTHER RELIANCE IS PLACED IN THE CASE OF CIT VS. SAINI MEDICAL STORE 277 ITR 420 (P&H) WHERE HON'BLE HIGH COURT IN THE NEARLY SIMILAR FACTS AND CIRCUMSTANCES AND RELY ING ON HON'BLE SUPREME COURT JUDGEMENT IN THE CASE OF HINDUSTAN ST EEL LTD. VS. STATE OF ORISSA (SUPRA) DELETED THE PENALTY AFTER F OLLOWING OBSERVATIONS. AS POINTED OUT EARLIER THERE IS NO D OUBT ABOUT THE GENUINENESS OF THE TRANSACTIONS WHICH HAVE BEEN FUL LY ACCEPTED IN THE ASSESSMENT MADE FOR THE YEAR UNDER CONSIDERATIO N. EVEN IF THERE IS ANY IGNORANCE WHICH RESULTED IN THE INFRA CTION OF LAW THE DEFAULT IS TECHNICAL OR VENIAL WHICH DID NOT PREJUD ICE THE INTERESTS OF THE REVENUE AS NO TAX AVOIDANCE OR TAX EVASION W AS INVOLVED. TO MY MIND BONA FIDE BELIEF COUPLED WITH THE GENUI NENESS OF THE TRANSACTIONS WOULD CONSTITUTE REASONABLE CAUSE U/S 273B FOR NOT INVOKING THE PROVISIONS OF SECTION 271E OF THE ACT. THE IMPUGNED ORDER OF PENALTY IS CANCELLED. 3.4 FURTHER RELIANCE IS PLACED IN THE CASE OF CIT VS. SUNIL KUMAR GOEL 315 ITR 163 (P&H) WHERE HON'BLE HIGH CO URT DELETED THE PENALTY BY FOLLOWING OBSERVATIONS. THE INCOME-TAX APPELLATE TRIBUNAL WAS RIGHT IN RE CORDING ITS CONCLUSION THAT A REASONABLE CAUSE HAD BEEN S HOWN BY THE RESPONDENT- ASSESSEE. THE INCOME-TAX APPELLATE TRIB UNAL RELIED ON THE FACT THAT THE RESPONDENT ASSESSEE HAD PRODUCED HIS CASH BOOKS DEPICTING LOANS TAKEN BY HIM UNILATERALLY BEFORE TH E REVENUE. ANOTHER FACT TAKEN INTO CONSIDERATION WAS THAT NO P REJUDICE WAS CAUSED TO THE REVENUE IN THE INSTANT ACTION OF THE RESPONDENT ASSESSEE IN AS MUCH AS THE RESPONDENT ASSESSEE DID NOT ATTEMPT BY ITA NO. 675/JP/2016 SHRI VIJAY SHARMA VS. ADDL. CIT RANGE-6 JAIPUR . 8 THE IMPUGNED ACT TO AVOID ANY TAX LIABILITY. FURTHE RMORE THERE IS NO DISPUTE ABOUT THE FACT THAT THE INSTANT CASH TRANSA CTIONS OF THE RESPONDENT-ASSESSEE WERE WITH THE SISTER CONCERN AN D THAT THESE TRANSACTIONS WERE BETWEEN THE FAMILY AND DUE TO BUS INESS EXIGENCY. A FAMILY TRANSACTION BETWEEN TWO INDEPENDENT ASSES SEES BASED ON AN ACT OF CASUALNESS SPECIALLY IN A CASE WHERE THE DISCLOSURE THEREOF IS CONTAINED IN THE COMPILATION OF ACCOUNTS AND WHICH HAS NO TAX EFFECT IN OUR VIEW ESTABLISHES REASONABLE CAUSE U/S 273B OF THE ACT. SINCE THE RESPONDENTASSESSEE HAD SATIS FACTORILY ESTABLISHED REASONABLE CAUSE U/S 273B OF THE AC T HE MUST BE DEEMED TO HAVE ESTABLISHED SUFFICIENT CAUSE FOR NOT INVOKING THE PENAL PROVISIONS (SECTION 271D AND 271E OF THE ACT) AGAINST HIM. FOR THE REASONS RECORDED HEREINABOVE WE FIND NO ME RIT IN EITHER OF THE AFORESAID TWO APPEALS I.E. ITA NOS. 777 AND 77 8 OF 2008 AND ACCORDINGLY THE SAID APPEALS ARE HEREBY DISMISSED. 3.5 FURTHER RELIANCE IS PLACED IN THE CASE OF SMT . KUSUM DHAMANI VS. THE ADDL. CIT RANGE-5 JPR(ITA NO.847/ JP/2011) WHERE HON'BLE ITAT JAIPUR DOUBLE BENCH DELETED THE PENALTY BY FOLLOWING OBSERVATIONS. ..FROM THE RECORD THERE IS NO SHRED OF DOUBT ABOU T THE GENUINENESS OF THE TRANSACTIONS AND THEIR DISCLOSUR E IN THE BOOKS OF ACCOUNT AND RETURNS OF BOTH THE ASSESSEE WHO HAPPEN TO BE HUSBAND AND WIFE CARRYING ON THE BUSINESS AS SISTER CONCER NS. SECTION 271D READ WITH SECTION 269SS WAS INTRODUCED BY THE LEGIS LATURE TO DISCOURAGE THE MENACE OF BLACK MONEY. SINCE THESE T RANSACTIONS ARE GENUINE THE ELEMENT OF BLACK MONEY IS TOTALLY RULE D OUT. THE ASSESSEE HAS GIVEN AN EXPLANATION IN OUR VIEW IS NO T UNREASONABLE AND IS BASED ON BUSINESS EXIGENCIES ALSO FOR PAYMEN TS TO LABOURERS AND LENDERS. UNDER THESE CIRCUMSTANCES WE ARE OF T HE VIEW THAT THE TRANSACTIONS BEING GENUINE AND THE ASSESSEE HAVING OFFERED REASONABLE EXPLANATION JUSTIFYING THESE CASH TRANSA CTIONS THE IMPUGNED PENALTY U/S 271D IS NOT LEVIABLE. THUS IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE DECISIO NS RELIED ON ABOVE THE PENALTY IS DELETED. NOW THE ASSESSEE MOST HUMBLY WANTS TO SUBMIT THAT O N THE BASIS OF ABOVE FACTS AND JUDICIAL PRONOUNCEMENT TH E IMPOSITION OF ITA NO. 675/JP/2016 SHRI VIJAY SHARMA VS. ADDL. CIT RANGE-6 JAIPUR . 9 PENALTY U/S 271D LEVIED BY THE LD.A.O. AND CONFIRME D BY CIT(A) IS NOT JUSTIFIED. 2.4 THE LD. DR RELIED ON THE ORDERS OF THE AUTHORIT IES BELOW. 2.5 I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS NOTED FROM THE RECORDS T HAT THE ASSESSEE HAD TAKEN UNSECURED FROM THE FOLLOWING PERSONS. (A) SMT. DHAPA DEVI (RELATION: GRAND MOTHER) S.NO. DATE AMOUNT RECEIVED 1. 01-04-2007 0/- 2. 10-08-2007 18 500/- 3. 15-08-2007 19 500/- 4. 17-08-2007 19 000/- 5. 02-10-2007 19 500/- 6. 04-10-2007 19 500/- 7. 05-10-2007 15 000/- 8. 10-10-2007 18 000/- 9 20-11-2007 17 600/- 10 23-11-2007 19 500/- 11 25-11-2007 17 500/- 12 29-11-2007 19 000/- 13 01-01-2008 15 400/- 14 07-02-2008 17 000/- 15 18-02-2008 18 000/- TOTAL 2 50 000/- (B) SMT. BGAGWATI DEVI (RELATION: MOTHER) S.NO. DATE AMOUNT RECEIVED 1 01-04-2007 0/- 2 01-09-2007 18 000/- 3 03-09-2007 16 000/- 4 05-09-2007 16 000/- TOTAL 50 000/- ITA NO. 675/JP/2016 SHRI VIJAY SHARMA VS. ADDL. CIT RANGE-6 JAIPUR . 10 (C) SHRI LAL CHAND SHARMA (RELATION: UNCLE) S.NO. DATE AMOUNT RECEIVED 1 01-04-2007 0/- 2 22-08-2007 19 500/- 3 04-10-2007 19 500/- 4 21-11-2007 16 400/- 5 23-11-2007 18 500/- 6 26-11-2007 18 000/- 7 29-11-2007 17 000/- 8 01-01-2008 18 100/- 9 07-02-2008 13 000/- 10 10-02-2008 10 000/- TOTAL 1 50 000/- IT IS NOTED FROM THE RECORDS THAT THE ASSESSEE HAD TAKEN THE ABOVE UNSECURED FROM HIS CLOSE RELATIVES IN ORDER TO MAKE PAYMENT TO M/S. MRF LTD. BEING THE ASSESSEE AS DEALER OF M/S. MRF LTD. IT IS ALSO NOTED THAT THE RELATIVES OF THE ASSESSEE HAD AGRICULTURAL INCOME O R DAIRY INCOME AND THEY DID NOT HAVE ANY BANK ACCOUNT. IT IS NOTED THAT THE ASSESSEE HAD TAKEN LOAN FOR CLEARANCE OF CHEQUE OR FOR MAKING DEMAND D RAFT FOR THE NECESSITY OF THE BUSINESS WHICH APPEARS TO BE A GENUINE AND BONA FIDE TRANSACTION FROM THE RECORDS AVAILABLE BEFORE THE BENCH. IT IS ALSO NOTED THAT THE TRANSACTION OF UNSECURED LOAN FROM THE RELATIVES WA S BELOW RS. 20 000/- IN THE ABOVE DATES. IT IS ALSO NOTED THAT SIMILAR TYPE OF ISSUE HAS ALSO BEEN DECIDED BY THE COORDINATE BENCH VIDE ITS ORDER DATE D 13-06-2014 IN THE CASE OF SMT. KUSUM DHAMANI VS. ADDL. CIT IN ITA NO. 847/JP/2011 FOR ITA NO. 675/JP/2016 SHRI VIJAY SHARMA VS. ADDL. CIT RANGE-6 JAIPUR . 11 THE ASSESSMENT YEAR 2006-07. HENCE IN VIEW OF THE DECISION OF ITAT COORDINATE BENCH DATED 13-06-2014 (SUPRA) AND THE C ASE LAWS RELIED ON BY THE LD. AR OF THE ASSESSEE I DIRECT TO DELETE T HE PENALTY OF RS. 4.50 LACS CONFIRMED BY THE LD. CIT(A) U/S 271D OF THE ACT. TH US THE APPEAL OF THE ASSESSEE IS ALLOWED. 3.0 IN THE RESULT THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 18 /10/2016 SD/- HKKXPUN ( BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 18 /10/ 2016 *MISHRA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI VIJAY SHARMA JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- THE ADDL. CIT RANGE-6 JAIPUR 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR ITAT JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 675/JP/2016) VKNS'KKUQLKJ@ BY ORDER LGK;D IATHDKJ @ ASSISTANT. REGISTRAR