NAYANA NANDKUMAR DESHMUKH, THANE V. ADDL CIT CEN RG, THANE, THANE

ITA 1835/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 7759 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-02-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 20-03-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRA BHAT JHA; PEEYUSH JAIN S S RANA
• Assessee Lawyers: SUBODH L RATNAPARKHI
• Keywords: Reasonable cause

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B, MUMBAI BEFORE SHRI R.S.SYAL, AM AND SHRI R.S.PADVEKAR, JM ITA NO.1835/MUM/2009 : ASST.YEAR 2005-2006 SMT.NAYANA NANDKUMAR DESHMUKH AT AND POST TUSE, TAL. WADA DIST : THANE. PA NO.ACPPT5888E. VS. THE ADDL.COMMISSIONER OF INCOME-TAX CENTRAL RANGE THANE. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUBODH L.RATNAPARKHI RESPONDENT BY : S/SHRI PEEYUSH JAIN, S.S.RANA & PRA BHAT JHA O R D E R PER R.S.SYAL, AM : THIS APPEAL BY THE ASSESSEE ARISES OUT OF THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON 15.1.2009 U PHOLDING THE PENALTY OF RS.35,000 IMPOSED BY THE ASSESSING OFFICER U/S.271D OF THE ACT. 2. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE HAD SHOWN A CASH LOAN OF RS.35,000 FROM SHRI MILIND DESHMUKH. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER INITIATED PENAL TY PROCEEDINGS U/S.271D. IN THE PENALTY PROCEEDINGS THE ASSESSEE WAS CALLED UPON TO EXPLAIN AS TO WHY THE PENALTY BE NOT IMPOSED FOR VIOLATION OF PROVISIONS OF SECTI ON 269SS OF THE ACT. THE ASSESSEE STATED THAT THERE WAS NO BANK IN THE AREA WHERE THE ASSESSEE WAS STAYING. THE A.O. FOUND THAT THE ASSESSEE HAD BANK ACCOUNT F OR THE LAST SEVERAL YEARS. HE, THEREFORE, DID NOT CONCUR WITH THE SUBMISSION ADVAN CED ON BEHALF OF THE ASSESSEE AND IMPOSED PENALTY OF RS.35,000 EQUAL TO THE AMOUN T OF CASH ACCEPTED AS LOAN. NO RELIEF WAS ALLOWED IN FIRST APPEAL. 3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS OBSERVED THAT THE ASSESSEE TOOK LOAN OF RS.35,000 IN CASH AND PURCHASED LAND WORTH RS.25,000 AT TUSE AND WORTH RS .30,000 AT DUNDHARAM. BOTH ITA NO.1835/MUM/2009 SMT.NAYANA NANDKUMAR DESHMUKH. 2 THESE TRANSACTIONS OF PURCHASING THE PROPERTIES AND RECEIPT OF LOAN WERE ENTERED INTO CASH. THE ASSESSEE FURNISHED CASH FLOW STATEME NT BEFORE THE ASSESSING OFFICER INDICATING THIS FACT WHICH HAS NOT BEEN TAKEN INTO CONSIDERATION. SIMILAR THE LD. CIT(A) ALSO FAILED TO DEAL WITH THIS ISSUE. IN OUR CONSIDERED OPINION, THE CASE OF THE ASSESSEE IS COVERED U/S.273B IN AS MUCH AS THERE WA S A REASONABLE CAUSE FOR ACCEPTING THE LOAN IN CASH. SINCE SECTION 271D IS S UBJECT TO SECTION 273B, WE HOLD THAT THE ASSESSEE HAD SUCCESSFULLY PROVED THE REASO NABLE CAUSE FOR THE RECEIPT OF LOAN OF RS.35,000 IN CASH. WE, THEREFORE, ORDER FOR THE DELETION OF PENALTY. 4. IN THE RESULT, THE APPEAL IS ALLOWED. ORDER PRONOUNCED ON THIS 10 TH DAY OF FEBRUARY, 2010. SD/- SD/- ( R.S.PADVEKAR ) ( R.S.SYAL ) JUDICIAL MEMBER ACCOUNTANT ME MBER MUMBAI : 10 TH FEBRUARY, 2010. DEVDAS* COPY TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT CONCERNED 4. THE CIT(A) - I, THANE. 5. THE DR/ITAT, MUMBAI. 6. GUARD FILE. TRUE COPY. BY ORDER ASSISTANT REGISTRAR, ITAT, MUMBAI. ITA NO.1835/MUM/2009 SMT.NAYANA NANDKUMAR DESHMUKH. 3 DATE INITIAL 1. DRAFT DICTATED ON 10.02.2010 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 10.02.2010 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS 7. FILE SENT TO THE BENCH CLERK SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 9. DATE OF DISPATCH OF ORDER. *