Rajesh Kumar Jaju, Kolkata V. ITO, Ward - 38(3), Kolkata, Kolkata

ITA 1630/KOL/2010

• Counselvise Citation: 163023514 RSA 2010
• Duration Of Justice: 3 year(s) 3 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2013
• Appeal Filed By: Assessee
• Bench Allotted: B
• Next Hearing Date: 08-07-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 17-08-2010
• Court: TRIBUNAL
• Department Lawyers: P DAM KANUNJNA LD
• Assessee Lawyers: A C GANERIWALA FCA LD
• Keywords: Principle of natural justice; Reasonable cause

Judgement Text

, B , , INCOME TAX APPELLATE TRIBUNAL, BENCH- B KOL KATA ( ) BEFORE . , SHRI R.C. SHARMA, ACCOUNTANT MEMBER !' /AND #$ '# , SHRI MAHAVIR SINGH, JUDICIAL MEMBER '% / ITA NO. 1630/KOL/2010 A.Y 2006-07 RAJESH KUMAR JAJU PAN: ACHPJ 9595J - !' - - VERSUS - . I.T.O WARD 38(3), KOLKATA ( () / APPELLANT ) ( *+() / RESPONDENT ) () /FOR THE APPELLANT //SHRI A.C. GANERIWALA, FCA, LD.AR *+() / FOR THE RESPONDENT: / SHRI P.DAM KANUNJNA, LD.JCIT/ SR.DR -'!. / 0 /DATE OF HEARING : 04-12--2013 12 / 0 /DATE OF PRONOUNCEMENT: 04-12-2013 / ORDER . , SHRI R.C. SHARMA, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER PASSED BY THE LD. CIT(A), DATED 31/05/2010 FOR THE ASSESSMENT YEAR 2006-07, IN THE MATTER OF IMPOSITION OF PENALTY U/S. 271D OF THE I.T ACT 1961 . 2. FOLLOWING GROUNDS HAVE BEEN TAKEN BY THE ASSESSE E:- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE THE LD.CIT(A) ERRED IN SUSTAINING IMPOSITION OF PENALTY U/S.271D RS.51000/- BEING 100% OF LOANS OF RS.18,000/- FROM RAJ KUMAR JAJU RS.18,000/- FROM MOTILAL RAJ KUMAR HUF & RS.15,000/ - FROM GHANASHYAM TEWARI EACH IN CASH ON THE ALLEGED GROUN D OF VIOLATION OF SEC 269SS INTERPRETING LITERALLY IGNORING THAT E ACH OF THE LOANS WERE FULLY VOUCHED, VERIFIABLE AND EVIDENCED BY RE LEVANT CREDITORS INCOME TAX RECORDS, THE CREDITORS WERE ASSESSEES F AMILY MEMBERS PURPOSE OF TAKING LOANS IN CASH WAS FULLY EXPLAINE D AND EVIDENCED BY BUSINESS REQUIREMENTS, REFLECTING TOTAL ABSENCE OF MENS ERA. ITA NO.1630/KOL/201-B-AM 2 2. THAT THE LD. I.T.O AND THE CIT(A) ERRED IN IGNO RING THAT IMPOSITION OF PENALTY U/S. 271D WAS NOT MANDATORY A ND SUCH IMPOSITION OF PENALTY WAS DELETED BY COORDINATE AUT HORITIES AND JUDGMENT BY HONBLE HIGH COURTS ON RECORD. 3. THAT IMPOSITION OF THE PENALTY IS CONTRARY TO C ANONS OF NATURAL JUSTICE AND THE ORDERS IMPOSING THE PENA LTY ARE UNJUSTIFIED AND BAD-IN-LAW. 4. WITHOUT PREJUDICE, THE PENALTY ORDER SERVED ON 3.8.09 IS BARRED BY LIMITATION U/S. 275(1)( C). 5. THAT THE ASSESSEE CRAVES LEAVE TO ADD TO/ALTER ALL OR ANY OF THE GROUNDS OF APPEAL 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PER USED. DURING THE COURSE OF ASSESSMENT THE AO FOUND THAT THE ASSESSEE HAS TAKEN LOAN FROM THE FOLLOWING PERSONS:- 1. RS.18,000/- FROM MOTILAL RAJKUMAR, HUF 2. RS.15,000/- FROM GHANASHYAM TEWARI & 3. RS.18,000/- FROM RAJ KUMAR JAJU, TOTALLING TO RS.51,000/- 3.1 THE AO ALSO FOUND THAT AS ON THE DATE ON WHICH LOANS WERE TAKEN BY THE ASSESSEE THE FOLLOWING AMOUNTS WERE OUTSTANDING RS.33,242/-, RS.1,17,222/- & RS.1,13,837/- RESPECTIVELY. THUS ON THE DATE ON WHICH THE LOANS W ERE ACCEPTED IN CASH THE AGGREAGATE AMOUNT OUTSTANDING WAS MORE THAN RS.20, 000/- AND THEREFORE, THE LOAN WAS ACCEPTED IN VIOLATION OF PROVISION OF SECTION 269SS . ACCORDINGLY, PENALTY PROCEEDINGS WERE INITIATED. DURING THE COURSE OF PENALTY PROCE EDINGS THE AO ASKED THE ASSESSEE TO PRODUCE COPY OF CASH BOOK TO SUBSTANTIATE THE CLA IM THAT THERE WAS IMMEDIATE CASH REQUIREMENT IN THE BUSINESS FOR WHICH THE ASSESSEE WAS COMPELLED TO ACCEPT CASH LOAN, ASSESSEE PRODUCED THE SAME. HOWEVER, NOT SATISFIE D BY ASSESSEES REPLY, AO LEVIED PENALTY OF RS.51,000/- U/S. 271D. THE ASSESSEE IN SUPPORT OF HIS CLAIM CITED CERTAIN DECISIONS WHICH WERE HELD BY THE AO TO BE NOT APPLI CABLE AND NOT BINDING AS THESE WERE NOT DECISIONS OF THE JURISDICTIONAL HIGH COUR T. 4. VIDE THE IMPUGNED ORDER OF THE LD.CIT(A) THE AC TION OF THE AO WAS CONFIRMED. AGAINST WHICH THE ASSESSEE IS IN FURTHER APPEAL BEF ORE US. 5. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE FOUND FROM THE RECORD THAT THE LOANS WERE TAKEN BY THE ITA NO.1630/KOL/201-B-AM 3 ASSESSEE FROM HIS CLOSE RELATIVES. THEY WERE THE M EMBERS OF ASSESSEES FAMILY. BEFORE THE LOWER AUTHORITIES THE ASSESSEE HAS FULLY EXPL AINED THE PURPOSE OF TAKING OF LOANS IN CASH. THE ASSESSEE HAS ALSO EXPLAINED THAT THE LOA NS WERE TAKEN IN CASH FOR THE PURPOSE OF URGENT BUSINESS REQUIREMENTS. WE FIND THAT THE E ACH AMOUNT OF LOAN WAS BELOW RS.20,000/-, WHICH WAS DULY CONFIRMED. GENUINENESS OF LOAN WAS NOT DOUBTED AND THE SAME WAS TAKEN FOR MEETING THE BUSINESS EXIGENCY. WE ALSO FIND THAT THE LOANS WERE TAKEN FROM ASSESSEES FAMILY MEMBERS/CLOSE RELATIVE S. THE LOAN AMOUNT WAS TAKEN WHEN BANKING HOURS OVER. THUS, WE FIND THAT THERE W AS REASONABLE CAUSE FOR ACCEPTING THE SMALL LOAN AMOUNT IN CASH FROM ASSESSEES CLOSE RELATIVES. KEEPING IN VIEW OF TOTALITY, FACTS AND CIRCUMSTANCES OF THE CASE VIS- -VIS THE CASE LAWS RELIED UPON BY THE LD.AR FOR THE ASSESSEE, WE DO NOT FIND ANY MERIT IN THE ACTION OF THE AO FOR IMPOSING A PENALTY U/S. 271D OF THE ACT. THE SAME IS HEREBY C ANCELLED. 06. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED AS STATED ABOVE. THIS ORDER IS PRONOUNCED IN OPEN COURT ON DT 04-12 -2013 SD/- SD/- ** PRADIP SPS / *3 4325 / COPY OF THE ORDER FORWARDED TO: 1. . () / THE APPELLANT : SHRI RAJESH KUMAR JAJU 15 NARAY AN CHANDRA DUTT ST., KOL-6. 2 *+() / THE RESPONDENT- I.T.O W 38(3), PODDAR COURT, 1 8 RABINDRA SARANI,KOL-1. 3 4. . ' / THE CIT, ' ( )/ THE CIT(A) 5 . !67 *' / DR, KOLKATA BENCH 6 . GUARD FILE . +3 */ TRUE COPY, '-/ BY ORDER, # '8 /ASSTT REGISTRAR ( #$ '# , ) ( MAHAVIR SINGH, JUDICIAL MEMBER) ( . , ) ( R.C. SHARMA, ACCOUNTANT MEMBER ( (( ( 0 0 0 0 ) )) ) DATE 04-12-2013