Shri Janardhanam Balaji, Thiruvallur V. ITO, Thiruvallur

ITA 3077/CHNY/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 4933 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-04-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 29-03-2017
• Assessment Year: 2012-2013
• Appeal Filed On: 03-11-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R DURAI
• Assessee Lawyers: G BASKAR
• Keywords: Reasonable cause
• Section: 273B; 68; 11

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : CHENNAI . . . , !' . #$#% , & '' ( [BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER ] ./I.T.A. NOS.3011 & 3077/MDS/2016 / ASSESSMENT YEARS : 2012-2013 SHRI. JANARDHANAM BALAJI, NO.164, CTH ROAD, THENDRAL NAGAR, THIRUNINRAVUR, CHENNAI 602 024. [PAN AIUPB4446K] VS. THE ADDITIONAL COMMISSIONER OF INCOME TAX, KANCHEEPURAM RANGE, KANCHEEPURAM. ( )* / APPELLANT) ( +,)* /RESPONDENT) / APPELLANT BY : SHRI. G. BASKAR, ADVOCATE /RESPONDENT BY : SHRI. R.DURAI PANDIAN, JCIT. /DATE OF HEARING : 29-03-2017 ! /DATE OF PRONOUNCEMENT : 07-04-2017 / O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER THESE ARE APPEALS FILED BY THE ASSESSEE DIRECTED AGAINST ORDERS DATED 29.09.2016 AND 18.10.2016 OF LD. COMMI SSIONER OF INCOME TAX (APPEALS)-7, CHENNAI CONFIRMING LEVY OF PENALTY U/S.271E AND 271D OF THE INCOME TAX ACT, 1961 (IN SHORT TH E ACT). ITA NOS.3011 & 3077/MDS/16 :- 2 -: 2. FACTS APROPOS ARE THAT ASSESSEE RUNNING A PETROL PU MP HAD FILED RETURN OF INCOME FOR THE IMPUGNED ASSESSMENT YEAR DISCLOSING INCOME OF RS.5,53,851/-. DURING THE COURSE OF ASSE SSMENT PROCEEDINGS, LD. ASSESSING OFFICER NOTED THAT ASSES SEE WAS MAINTAINING A BOOK CALLED SUNDRY DEBTORS LEDGER. AS PER LD. A SSESSING OFFICER SUCH LEDGER ACCOUNT REFLECTED CASH PAYMENTS AND CASH REC EIPTS FROM VARIOUS PARTIES. HE LISTED OUT SUCH CASH PAYMENTS AND CAS H RECEIPTS AS UNDER:- DATE PARTICULARS VCH TYPE VCH. NO DEBIT CREDIT 2.4.2011 CASH IN HAND RECEIPT 1 2 70,000 6.4.2011 CASH IN HAND RECEIPT 29 1,80,000 7.4.2011 CASH IN HAND RECEIPT 35 4,50,000 8.4.2011 CASH IN HAND RECEIPT 37 3,10,000 14.5.2011 CASH IN HAND RECEIPT 178 70,000 26.5.2001 CASH IN HAND RECEIPT 215 1,60,000 2.10.2011 CASH IN HAND RECEIPT 578 2,00,000 20.12.2011 CASH IN HAND PAYMENT 1631 1,00,000 22.12.2011 CASH IN HAND PAYMENT 1646 1,00,000 24.12.2011 CASH IN HAND PAYMENT 1663 1,00,000 27.12.2011 CASH IN HAND PAYMENT 1683 1,00,000 03.01.2012 CASH IN HAND PAYMEN T 1730 1,00,000 10.1.2012 CASH IN HAND PAYMENT 1775 1,00,000 18.01.2012 CASH IN HAND PAYMENT 1829 1,00,000 25.1.2012 CASH IN HAND PAYMENT 1872 1,00,000 29.1.2012 CASH IN HAND PAYMENT 1892 1,00,000 15.02.2012 CASH IN HAND PAYMENT 2004 50,000 18.3.2012 CASH IN HAND PAYMENT 2216 50,000 24.03.2012 CASH IN HAND PAYMENT 2261 50,000 25.03.2012 CASH IN HAND PAYMENT 2270 1,00,000 26.03.2012 CASH IN HAND PAYMENT 2279 50,000 27.03.2012 CASH IN HAND PAYMENT 2287 90,000 28.03.2012 CASH IN HAND PAYMENT 2298 50,000 29.03.2012 CASH IN HAND PAYMENT 2307 50,000 30.03.2012 CASH IN HAND PAYMENT 2316 50,000 TOTAL 14,40,000 14,40,000 ITA NOS.3011 & 3077/MDS/16 :- 3 -: WHEN THE ASSESSMENT WAS COMPLETED, NO DISALLOWANCE WAS MADE BY THE LD. ASSESSING OFFICER FOR ANY OF THE ABOVE RECE IPTS OR PAYMENTS BUT THERE WERE CERTAIN OTHER DISALLOWANCES FOR WANT OF DEDUCTION OF TAX AT SOURCE AND ON BUSINESS PROMOTION EXPENSES. HOWEVE R, LD. ASSESSING OFFICER MADE A MENTION IN THE ASSESSMENT ORDER THA T CONDITIONS STIPULATED IN SEC. 269SS AND 269T IN THE TRANSACTIO NS WERE VIOLATED IN THE TABLE LISTED ABOVE, THEREBY ATTRACTING PENAL P ROCEEDINGS U/S. 271D AND 271E OF THE ACT. 3 . THEREAFTER NOTICES WERE ISSUED TO THE ASSESSEE TO SHOW- CAUSE WHY PENALTY SHOULD NOT BE LEVIED U/S.271D AND 271E OF THE ACT FOR ACCEPTING LOANS AND REPAYING THEM IN CASH BEYON D THE LIMITS PRESCRIBED U/S.269SS AND 269T OF THE ACT. IN REPLY TO THE ABOVE NOTICES, ASSESSEE SUBMITTED AS UNDER:- ' ... I WISH TO INFORM YOU THAT MY NATURE OF BUSINESS IS OPERATING PETROL BUNK. TO ENHANCE THE CUSTOMER SERVICE, SOMETIMES, WE ACCEPT THE SECURITY DEPOSITS/J ADVANCE FROM OUR CUSTOMERS. FUR THE CUSTOMERS WHO REGULARLY DEAL WITH US ON 'CREDIT BASIS, WE MAINTAI N SEPARATE LEDGER ACCOUNTS FOR THEM (LIKE A GENERAL TRADING CONCERN). OTHER THAN THE ABOVE SAID CUSTOMERS, THE. BUSINESS ENTITIES LIKE TRANSPORTERS, SMALL CORPORAT E,. PREMIUM CUSTOMERS, CAB OPERATORS WHO WILL BE SENDING ONLY THEIR WORKERS/ ASSISTANCE FOR FILING THE FUEL, WILL ITA NOS.3011 & 3077/MDS/16 :- 4 -: CHOOSE TO MAKE PAYMENT, IT IN ADVANCE TO REDUCE THE CASH HANDLING BY THE WORKERS AND IN SOME OCCASIONS TO FIX THE FUEL RATE IN CASE OF INCREASING TREND. HOWE VER, EACH PAYMENT /RECEIPT WILL NOT EXCEED THE STIPULATED' LIMIT OF RS.20,OOO/-. . WE WILL CONSOLIDATE TWO/ T HREE DAYS TRANSACTIONS AND ENTER IN' THE BOOKS OF ACCOUNT UNDER SINGLE ENTRY IN THE ACCOUNT 'SUNDRY DEBTORS', LF TH E ADVANCE / SECURITY DEPOSIT HAS NOT BEEN UTILIZED FOR MORE THAT 6 TO 9 MONTHS, WE TEND TO RETURN THE MONEY TO AVOID DISPUTE FUTURE. AS SAID ABOVE, THE REPAYMENT ENTRY ALSO MADE IN THE BOOKS OF ACCOUNTS CONSOLIDATED FOR TWO / THREE DAYS. HOWEVER, EACH PAYMENT / RECEIPT WILL BE LESS THAN RS.20,OOO/- PER PERSON. HENCE, I WISH TO BRI NG TO . YOUR NOTICE THAT I HAVE NOT VIOLATED THE PROVISIONS OF F SECTION 269SS/ 269T. AS READING IN THE BOOKS OF ACCOUNT WAS MADE ON CONSOLIDATED BASIS, PRIMA FACIE IT APPEARS THAT I H AVE VIOLATED THE PROVISIONS. HOWEVER, I HAVE NOT VIOLATED THE PROVISIONS OF SECTION 269SS/269T, , ALL THESE TRANS ACTION HAVE ALSO BEEN EXPLAINED ORALLY TO THE ASSESSING OFFICE R DURING THE SCRUTINY PROCEEDINGS KINDLY CONSIDER THE ABOVE SUBMISSIONS AND DROP THE PENALTY PROCEEDINGS. DURING THE PENALTY PROCEEDING BEFORE LD. ASSISTANT COMMISSIONER OF INCOME TAX (IN SHORT LD. ACIT) VOUCHERS WERE P RODUCED BY THE ASSESSEE AND THESE WERE EXAMINED. AS PER LD. ACIT ASSESSEE WAS REPEATEDLY GETTING THE ADVANCES FROM VERY SAME PER SONS AND NONE OF ITA NOS.3011 & 3077/MDS/16 :- 5 -: THE ADVANCES WERE SETTLED AGAINST SALE OF ANY FUEL. AS PER LD. ACIT, EACH OF THE ADVANCE WAS REPAID IN CASH BY THE ASSE SSEE. LD. ACIT SELECTED FIVE PERSONS FROM THE VOUCHERS PRODUCED BY THE ASSESSEE AND CULLED OUT THE FOLLOWING DATA. DATE V. NO RECEIVED FROM AMOUNT RECEIVED AMOUNT REPAID DATE 02.4.2011 12 RANJITHAM 16300 16300 20.12.2011 06.4.2011 29 RANJITHAM 15500 155 00 22.12.2011 07.04.2011 35 RANJITHAM 16500 16500 27.12.2011 08.04.2011 37 RANJITHAM 15800 15800 25.01.2012 14.05.2011 178 RANJITHAM 13200 13200 25.03.2012 26.05.2011 215 RANJITHAM 12900 12900 26.03.2012 02.10.2011 578 RANJITHAM 14600 14600 28.03.2012 02.04.2011 12 RADHA EXPORT 11900 11900 27.12.2011 06.04.2011 29 RADHA EXPORT 17000 17000 20.12.2011 07.04.2011 35 RADHA EXPORT 14100 14100 22.12.2011 08.04.2011 37 RADHA EXPORT 14200 14200 25.01.2012 14.05.2011 178 RADHA EXPORT 16800 16800 25.03.2012 26.05.2011 215 RADHA EXPORT 15100 15100 25.03.2012 02.10.2011 578 RADHA EXPORT 13100 13100 27.03.2012 06.04.2011 29 BASKARAN TRAVELS 10800 10800 24.12.2011 07.04.2011 35 BASKARAN TRAVELS 16800 16800 03.01.2012 08.04.2011 37 BASKARAN TRAVELS 19100 191 00 29.01.2012 26.05.2011 215 BASKARAN TRAVELS 17100 17100 27.03.2012 02.10.2011 578 BASKARAN TRAVELS 13500 13500 30.03.2012 06.04.2011 29 SEKARAN 17300 17300 22.12.2011 07.04.2011 35 SEKARAN 18200 18200 03.01.2012 08.04.2011 37 SEKARAN 13600 13600 29. 01.2012 26.05.2011 215 SEKARAN 11700 11700 26.03.2012 02.10.2011 578 SEKARAN 18700 18700 29.03.2012 06.04.2011 29 AISU CATERING 11900 11900 24.12.2011 07.04.2011 35 AISU CATERING 14300 14300 03.01.2012 08.04.2011 37 AISU CATERING 15300 15300 29.01.201 2 26.05.2011 215 AISU CATERING 5200 5200 27.03.2012 02.10.2011 578 AISU CATERING 15800 15800 29.03.2012 ITA NOS.3011 & 3077/MDS/16 :- 6 -: AS PER LD. ACIT IT WAS NOT PRACTICABLE TO RECEIVE A ND REPAY IDENTICAL AMOUNTS. ACCORDING TO HIM, VOUCHERS PRODUCED BY TH E ASSESSEE WERE PREPARED AS AN AFTER THOUGHT SO AS TO ARTIFICIALLY KEEP THE TRANSACTIONS BELOW THE SUM OF RUPEES TWENTY THOUSAND. FURTHER, AS PER LD. ACIT, ASSESSEE IF IT HAD ACTUALLY RECEIVED MONEY IN TRA NCHES FROM VERY SAME PERSON IT WOULD HAVE OPENED SEPARATE LEDGER AC COUNT FOR EACH SUCH PERSON AND NOT CATEGORIZED ALL OF THEM UNDER T HE HEAD SUNDRY DEBTORS. SINCE ASSESSEE HAD RECEIVED LOANS AGGREG ATING TO G14,40,000/- AND REPAID THE SAME AMOUNT, ALL IN CAS H, DURING THE CURRENCY OF THE PREVIOUS YEAR, LD ACIT CAME TO A CO NCLUSION THAT THERE WERE VIOLATION OF BOTH SECTIONS 269SS AND 269T OF THE ACT. HE LEVIED PENALTY BOTH U/SEC. 271D AND 271E OF THE ACT AT A S UM OF RS.14,40,000/- EACH. 4. AGGRIEVED, ASSESSEE MOVED IN APPEALS BEFORE LD. COMMISSIONER OF INCOME TAX (APPEALS) AGAINST PENALT Y LEVIED U/S. 271D AS WELL AS 271E OF THE ACT. CONTENTION OF THE ASSESSEE BEFORE LD. COMMISSIONER OF INCOME TAX (APPEALS) WAS THAT EACH OF THE AMOUNT RECEIVED AS WELL AS REPAID WERE BELOW RUPEES TWENT Y THOUSAND AND HENCE SECTIONS 269SS AND 269T OF THE ACT WERE NOT A TTRACTED. HOWEVER, LD. COMMISSIONER OF INCOME TAX (APPEALS) W AS NOT ITA NOS.3011 & 3077/MDS/16 :- 7 -: IMPRESSED BY ANY OF THE ARGUMENTS RAISED BY THE ASS ESSEE. HE UPHELD THE ORDER OF THE LD. ACIT CITING THE FOLLOWING REA SONS. 1. THE APPELLANT IS TAKING ADVANCES UPON ADVANCES FR OM THE SAME PERSON WITHOUT SETTLING/UTILIZING THE EARLIER AMOUNT RECEIVED. 2. THE' VOUCHERS WERE NOT PRODUCED DURING THE ORIGINAL ASSESSMENT PROCEEDINGS. THE VOUCHERS PRODUCED DURING THE PENALTY PROCEEDINGS REVEAL VARIOUS INFIRMITIES AS RECORDED BV THE AO. 3. THE HON'BLE MADRAS HIGH COURT IN THE CASE OF P. MUTHUKARUPPAN VS JOINT CIT REPORTED IN [2015] 92 CCH 0357 (MAD), HELD THAT THE ASSESSING OFFICER IN ORDE R TO EXERCISE HIS DISCRETION UNDER SECTION 27313 OF THE ACT HAS TO TAKE INTO ACCOUNT THE FACTS AND CIRCUMSTANCES OF THE CASE -AS WELL AS THE CONDUCT- OF THE ASSESSEE. THE ASSESSEE HAS TO PROVE THAT THERE WAS A REASONABLE CAUSE FOR THE FAILURE TO FOLLOW THE MANDATE OF SECTION 269SS/269T OF THE ACT. IN THE APPELLANT'S CASE, I FIND THAT THE TRANSACTIONS HAVE BEEN CAREFULLY ARRANGED TO KEEP EVERY SINGLE TRANSACTION BELOW THE SPECIFIED LIMIT OF RS.20,OOO/- AND ENGAGED IN M ULTIPLE TRANSACTIONS WITH THE SAME PERSON ON DIFFERENT DATE S. FURTHER, THE NON-PRODUCTION OF VOUCHERS DURING THE ASSESSMENT PROCEEDINGS, AND THEIR APPEARAR1CE DURIN G PENALTY PROCEEDINGS CLEARLY POINT TO LACK OF TRANSP ARENCY AND AN ATTEMPT TO STITCH UP AN EXPLANATION. 4. THE EXPLANATIONS FURNISHED BY THE APPELLANT, IN MY CONSIDERED ITA NOS.3011 & 3077/MDS/16 :- 8 -: OPINION, DO NOT COME WITHIN THE PURVIEW OF 'BONAFID E REASON', 'BUSINESS EXIGENCIES', OR DUE TO 'GENUINE HARDSHIP' WHICH PROMPTED HIM TO UNDERTAKE THE TRANSACTIONS IN SUCH A MANNER. HENCE, THE JUDICIAL DECISIONS RELIED UPON BY THE AP PELLANT DO NOT GIVE HIM ANY COMFORT AT ALL. 5. THE APPELLANT'S EXPLANATIONS ARE NOT CONVINCING THAT THERE WAS A REASONABLE CAUSE FOR NON ADHERENCE TO THE PROVISI ONS OF SECTION 269'55 AND SECTION 269T OF THE ACT. 5. NOW BEFORE US, LD. AUTHORISED REPRESENTATIVE ASS AILING THE PENALTY ORDERS, SUBMITTED THAT PENALTY PROCEEDINGS WERE INITIATED BY THE LD. ASSESSING OFFICER DURING THE COURSE OF ASSE SSMENT PROCEEDINGS AND THIS WAS SPECIFICALLY NOTED BY THE LD. ASSESSIN G OFFICER IN THE ASSESSMENT ORDER. RELYING ON THE JUDGMENT OF HONBL E CALCUTTA HIGH COURT IN THE CASE OF CIT VS. NARAYANI & SONS (P) LTD (2016) 141 DTR 315 , LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT TIME LIMIT FOR PASSING THE PENALTY ORDERS U/S. 271D AND 271E OF T HE ACT STARTED WHEN PROCEEDINGS WERE INITIATED BY THE LD. ASSESSIN G OFFICER. ACCORDING TO HIM, IT WAS NOT NECESSARY THAT LD. AC IT HIMSELF SHOULD INITIATE THE PENALTY PROCEEDINGS. AS PER THE LD. A UTHORISED REPRESENTATIVE, PENALTY PROCEEDINGS COULD BE INITI ATED BY THE LD. ASSESSING OFFICER AND COMPLETED BY THE LD. ACIT. HE NCE ACCORDING TO ITA NOS.3011 & 3077/MDS/16 :- 9 -: HIM, ORDERS U/SECTION 271D AND 271E OF THE ACT WERE BARRED BY LIMITATION. 6. ON MERITS LD. AUTHORISED REPRESENTATIVE SUBMITTE D THAT IN THE NATURE OF THE TRADE OF THE ASSESSEE, IT WAS NOT POSSIBLE TO RECEIVE ADVANCES IN CASH. ACCORDING TO HIM, EACH OF THE PER SON FROM WHOM MONEY WAS ACCEPTED WERE CUSTOMERS OF THE ASSESSEE A ND THE TRANSACTIONS WERE CONSIDERED AS GENUINE BY THE LOW ER AUTHORITIES. ACCORDING TO HIM, IF THE LOAN TRANSACTIONS WERE DI SBELIEVED AN ADDITION OUGHT HAVE BEEN MADE U/S.68 OF THE ACT. WHEN LOAN AND REPAYMENT OF SUCH LOAN WERE BELIEVED, THEN THE TRANSACTIONS WERE GENUINE AND SECTIONS 271D AND 271E OF THE ACT COULD NOT BE APPL IED. THUS, ACCORDING TO HIM, PENALTY LEVIED UNDER BOTH THE SEC TIONS HAD TO CANCELLED. 7. PER CONTRA, LD. DEPARTMENTAL REPRESENTATIVE STR ONGLY SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IN SO FAR AS QUESTION OF LIMITA TION IS CONCERNED, WHAT WE FIND IS THAT LD. ASSESSING OFFICER IN THE A SSESSMENT ORDER HAD MENTIONED AS UNDER IN RELATION TO THE OPERATION OF THE DEBTORS LEDGERS. ITA NOS.3011 & 3077/MDS/16 :- 10 -: THE MODE OF TRANSACTIONS IN THE ABOVE LEDGER A/C. ARE IN CASH IN EXCESS OF G20,000/-. IN THE ABSENCES OF PROPER EXPLANATION. IT IS INFERRED THAT THE ABOVE TRANSACTIONS ARE IN THE NATURE OF LOAN CREDITOR. T HE ASSESSEE RECEIVED MONEY EXCEEDING G20,000/- AS LOAN IN CASH AGGREGATING TO G14,40,000/- AND REPAID THE ENTIRE LOAN EXCEEDING G20,000/- IN CASH IN THE YEAR ITSELF. HENCE, THE CONDITIONS STIPULATED IN SECTIO N 269SS AND 269T ARE VIOLATED WHICH ATTRACTS THE PENA L PROVISIONS UNDER SECTION 271D AND 271E. HE HAD ONLY MADE AN OBSERVATION THAT CONDITIONS S TIPULATED IN SEC. 269SS AND 269T OF THE ACT WERE VIOLATED AND THIS W OULD ATTRACT PENAL PROVISION OF SEC. 271D AND 271E OF THE ACT. IN OUR OPINION, THIS WAS ONLY A BENIGN OBSERVATION AND CANNOT BE TREATED AS INITIATION OF THE PENALTY PROCEEDINGS. THERE IS NO DISPUTE THAT NOT ICES ISSUED TO THE ASSESSEE BY THE LD. ACIT, KANCHEEPURAM U/S. 274 R.W .S. 271D AND 271E OF THE ACT WERE DATED 31.8.2015. THE PENALTY ORDERS WERE ALSO PASSED BY LD. ACIT, KANCHEEPURAM. SUCH PENALTY ORDE RS WERE PASSED ON 29.02.2016 AND WAS THEREFORE WELL WITHIN THE TIM E LIMITS. 9. NOW COMING TO THE MERITS OF THE CASE, EVEN IF WE ACCEPT THE VOUCHERS PRODUCED BY THE ASSESSEE IN SUPPORT OF THE TRANSACTIONS, THE AGGREGATE AMOUNT OF LOAN TAKEN FROM ONE PERSON CLEA RLY EXCEEDED THE SUM OF G20,000/-. BOTH SECTIONS 269SS AND 269T ARE REPRODUCED HEREUNDER:- ITA NOS.3011 & 3077/MDS/16 :- 11 -: SECTION 269SS NO PERSON SHALL AFTER THE 30TH DAY OF JUNE, 1984, TAKE OR ACCEPT FROM ANY OTHER PERSON(HEREAFTER IN THIS SECTION REFERRED TO AS THE DEPOSITOR), ANY LOA N OR DEPOSIT OTHERWISE THAN BY AN ACCOUNT PAYEE CHEQUE OR ACCOUNT PAYEE BANK DRAFT IF,-- (A) THE AMOUNT OF SUCH LOAN OR DEPOSIT OR THE AGGREGATE AMOUNT OF SUCH LOAN AND DEPOSIT ; OR (B) ON THE DATE OF TAKING OR ACCEPTING SUCH LOAN OR DEPOSIT, ANY LOAN OR DEPOSIT TAKEN OR ACCEPTED EARLIER BY SUCH PERSON FROM THE DEPOSITOR IS REMAINING UNPAID(WHETHER REPAYMENT HAS FALLEN DUE OR NOT), THE AMOUNT OR THE AGGREGATE AMOUNT REMAINING UNPAID ; OR (C) THE AMOUNT OR THE AGGREGATE AMOUNT REFERRED TO IN CLAUSE(A) TOGETHER WITH THE AMOUNT OR THE AGGREGATE AMOUNT REFERRED TO IN CLAUSE(B), IS TWENTY THOUSAND RUPEES OR MORE: PROVIDED THAT THE PROVISIONS OF THIS SECTION SHALL NOT APPLY TO ANY LOAN OR DEPOSIT TAKEN OR ACCEPTED FROM, OR ANY LOAN OR DEPOSIT TAKEN OR ACCEPTED BY,- -(A) GOVERNMENT ;(B) ANY BANKING COMPANY, POST OFFICE SAVINGS BANK OR CO-OPERATIVE BANK ;(C) ANY CORPORATION ESTABLISHED BY A CENTRAL, STATE OR PROVINCIAL ACT ;(D) ANY GOVERNMENT COMPANY AS DEFINED IN SECTION 617 OF THE COMPANIES ACT, 1956(1 OF 1956) ;(E) SUCH OTHER INSTITUTION, ASSOCIATION OR BODY OR CLASS OF INSTITUTIONS, ASSOCIATIONS OR BODIES WHICH THE CENTRAL GOVERNMENT MAY, FOR REASONS TO BE RECORDED IN WRITING, NOTIFY IN THIS BEHALF IN THE OFFICIAL GAZE TTE. PROVIDED FURTHER THAT THE PROVISIONS OF THIS SECTIO N SHALL NOT APPLY TO ANY LOAN OR DEPOSIT WHERE THE PERSON FROM WHOM THE LOAN OR DEPOSIT IS TAKEN OR ACCEPTED AND THAT PERSON BY WHOM THE LOAN OR DEPOSIT IS TAKEN OR ACCEPTED ARE BOTH HAVING AGRICULTURAL INCOME AND NEITHER OF THEM HAS ANY INCOME CHARGEABLE TO TAX UNDER THIS ACT. ITA NOS.3011 & 3077/MDS/16 :- 12 -: SECTION 269T NO BRANCH OF A BANKING COMPANY OR A CO-OPERATIVE BANK AND NO OTHER COMPANY OR CO-OPERATIVE SOCIETY AND NO FIRM OR OTHER PERSON SHALL REPAY ANY LOAN OR DEPOSIT MADE WITH IT OR ANY SPECIFIED ADVANCE RECEIVED BY IT OTHERWISE THAN BY AN ACCOUNT PAYEE CHEQUE OR ACCOUNT PAYEE BANK DRAFT DRAWN IN THE NAME OF THE PERSON WHO HAS MADE THE LOAN OR DEPOSIT OR PAID THE SPECIFIED ADVANCE, OR BY USE OF ELECTRONIC CLEARING SYSTEM THROUGH A BANK ACCOUNT (A) THE AMOUNT OF THE LOAN OR DEPOSIT OR SPECIFIED ADVANCE TOGETHER WITH THE INTEREST, IF ANY, PAYABLE THEREON, OR (B) THE AGGREGATE AMOUNT OF THE LOANS OR DEPOSITS HELD BY SUCH PERSON WITH THE BRANCH OF THE BANKING COMPANY OR CO-OPERATIVE BANK OR, AS THE CASE MAY BE, THE OTHER COMPANY OR CO-OPERATIVE SOCIETY OR THE FIRM, OR OTHER PERSON EITHER IN HIS OWN NAME OR JOINTLY WITH ANY OTHER PERSON ON THE DATE OF SUCH REPAYMENT TOGETHER WITH THE INTEREST, IF ANY, PAYABLE ON SUCH LOANS OR DEPOSITS OR, (C) THE AGGREGATE AMOUNT OF THE SPECIFIED ADVANCES RECEIVED BY SUCH PERSON EITHER IN HIS OWN NAME OR JOINTLY WITH ANY OTHER PERSON ON THE DATE OF SUCH REPAYMENT TOGETHER WITH THE INTEREST, IF ANY, PAYABLE ON SUCH SPECIFIED ADVANCES, IS TWENTY THOUSAND RUPEES OR MORE : PROVIDED THAT WHERE THE REPAYMENT IS BY A BRANCH OF A BANKING COMPANY OR CO-OPERATIVE BANK, SUCH REPAYMENT MAY ALSO BE MADE BY CREDITING THE AMOUNT OF SUCH LOAN OR DEPOSIT TO THE SAVINGS BANK ACCOUNT OR THE CURRENT ACCOUNT (IF ANY) WITH SUCH BRANCH OF THE PERSON TO WHOM SUCH LOAN OR DEPOSIT HAS TO BE REPAID : PROVIDED FURTHER THAT NOTHING CONTAINED IN THIS SECTION SHALL APPLY TO REPAYMENT OF ANY LOAN OR DEPOSIT OR SPECIFIED ADVANCE TAKEN OR ACCEPTED FROM(I) GOVERNMENT ;(II) ANY BANKING COMPANY, POST OFFICE SAVINGS BANK OR CO-OPERATIVE BANK ;(III ) ANY CORPORATION ESTABLISHED BY A CENTRAL, STATE OR ITA NOS.3011 & 3077/MDS/16 :- 13 -: PROVINCIAL ACT ;(IV) ANY GOVERNMENT COMPANY AS DEFINED IN SECTION 617 OF THE COMPANIES ACT, 1956 (1 OF 1956) ;(V) SUCH OTHER INSTITUTION, ASSOCIATIO N OR BODY OR CLASS OF INSTITUTIONS, ASSOCIATIONS OR BODIES WHICH THE CENTRAL GOVERNMENT MAY, FOR REASONS TO BE RECORDED IN WRITING, NOTIFY IN THIS BEHALF IN THE OFFICIAL GAZETTE. IT IS VERY CLEAR FROM THE ABOVE SECTIONS THAT WHAT IS TO BE CONSIDERED IS THE AGGREGATE AMOUNT. NO DOUBT BY VIRTUE OF SE CTION 273B OF THE ACT, IF AN ASSESSEE COULD PROVE THAT THE FAILURE TO ABIDE BY SEC. 269SS AND 269T OF THE ACT WAS FOR A REASONABLE CAUS E THEN LEVY OF PENALTY U/S.271D AND 271E OF THE ACT, COULD BE EXCU SED. HOWEVER, HERE IN THE CASE BEFORE US, FIRST EXPLANATION OF T HE ASSESSEE WAS THAT THE AMOUNTS RECEIVED WERE ADVANCES FROM ITS CUSTOME RS, SO THAT EMPLOYEES OF SUCH CUSTOMERS WHO CAME FOR FUELING OF VEHICLES NEED NOT MAKE PAYMENTS IN CASH. OR IN OTHER WORDS, AS P ER THE ASSESSEE IT WAS TO REDUCE CASH HANDLING BY THE WORKERS OF TRANS PORTERS, CAB DRIVERS ETC. HOWEVER, LD. ACIT HAS CLEARLY DEMONSTR ATED THAT NO SUCH ADJUSTMENT AGAINST COST OF FUEL WAS EVER DONE AGAIN ST THE ADVANCE, ON THE OTHER HAND BUT SUCH AMOUNTS WERE REPAID BY THE ASSESSEE IN CASH. 10. COMING TO THE CONTENTION OF THE LD. AUTHORISED REPRESENTATIVE THAT IF THE LOANS WERE DISBELIEVED S EC. 68 OF THE ACT ITA NOS.3011 & 3077/MDS/16 :- 14 -: ALONE COULD HAVE BEEN APPLIED, LD. ASSESSING OFFICE R HAVING ACCEPTED THE LOANS THE LINE OF ARGUMENT IS IRRELEVANT. 11. CONSIDERING THESE CIRCUMSTANCES, WE ARE OF THE OPINION THAT PENALTY U/S. 271D AS WELL AS 271E OF THE ACT FOR VI OLATION OF SEC. 269SS AND 269T OF THE ACT WERE RIGHTLY IMPOSED, ASSESSEE HAVING FAILED TO GIVE A REASONABLE CAUSE FOR NOT LEVYING SUCH PENAL TY. WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDERS OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS). 12. IN THE RESULT, APPEALS OF THE ASSESSEE STAND DI SMISSED. ORDER PRONOUNCED ON FRIDAY, THE 7TH DAY OF APR IL, 2017 AT CHENNAI. SD/- SD/- ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER ( !' . #$#% ) (ABRAHAM P. GEORGE) & / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED: 7TH APRIL, 2017 KV &' ()*) / COPY TO: 1 . / APPELLANT 3. +,' / CIT(A) 5. )-. / / DR 2. / RESPONDENT 4. + / CIT 6. .01 / GF