Mr. Ramchandra S. Parge, Pune V. ACIT, Range-2, Pune

ITA 868/PUN/2011

• Counselvise Citation: 86824514 RSA 2011
• Duration Of Justice: 3 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 21-04-2014
• Assessment Year: 2002-2003
• Appeal Filed On: 16-06-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K MODI; P S NAIK
• Keywords: Search and seizure; Document seized; Condonation of delay; Documents seized
• Section: 143(3); 27; 132; 10; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO.868/PN/2011 (ASSESSMENT YEAR: 2002-03) MR. RAMCHANDRA S. PARGE NEAR BHAIRAVNATH MANDIR, KOTHRUD KHURD, PUNE 411048 PAN: ABQPP0950P . APPELLANT VS. THE ADDL. COMMISSIONER OF INCOME TAX RANGE 2, PUNE . RESPONDENT APPELLANT BY : SHRI KISHORE PHADKE RESPONDENT BY : S/SHRI A.K. MODI & P.S. NAIK DATE OF HEARING : 31-10-2014 DATE OF PRONOUNCEMENT : 25-11-2014 ORDER PER SUSHMA CHOWLA, JM: THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT(A)-II, PUNE DATED 20.01.2010 RELATING TO ASSESSMENT YEAR 2002- 03 AGAINST PENALTY LEVIED UNDER SECTION 271D OF THE INCOME-TAX ACT. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THE LEARNED CIT(A)-II, PUNE ERRED IN LAW AND ON FAC TS IN DISMISSING THE APPEAL AND CONFIRMING THE PENALTY OF RS.11,00,000/- LEVIED BY LEARNED ASSESSING OFFICER U/S 271D OF THE I.T. ACT, 1961 FOR ALLEGED VIOLATION OF PRO VISIONS OF SECTION 269SS OF THE I.T. ACT, 1961. 2. THE LEARNED CIT(A)-II, PUNE ERRED IN LAW AND ON FAC TS IN CONFIRMING THAT ASSESSEE MUST HAVE TAKEN A CASH LOAN OF RS.11,00,000/- FROM MR. SHRIRAM SONI. 3. THE APPELLANT CRAVES LEAVE TO ADD / MODIFY / ALTER / DELETE ALL / ANY OF THE GROUNDS OF APPEAL. ITA NO.868/PN/2011 RAMCHANDRA S. PARGE 2 3. THE PRESENT APPEAL WAS FILED BY THE ASSESSEE AFTER A DELAY OF ONE YEAR AND 85 DAYS. THE ASSESSEE HAS FILED AN APPLICATION FOR CONDONATION OF DELAY IN FILING THE PRESENT APPEAL BEFORE THE TRIBUNAL. IT WAS POINTED OUT BY THE LEARNED AUTHORIZED REPRESENT ATIVE FOR THE ASSESSEE IN THE SAID APPLICATION THAT THE ORDER OF CIT(A) DATED 20.01.2008 WAS RECEIVED BY THE ASSESSEE. HOWEVER, THE D ATE OF RECEIPT WAS NOT KNOWN TO THE ASSESSEE AND THE PERIOD OF DELAY HAS BEEN COUNTED FROM THE DATE OF ORDER OF CIT(A) RESULTING IN DELAY OF ABOUT ONE YEAR AND 85 DAYS. IT WAS FURTHER PLEADED BY THE ASSES SEE THAT THERE WAS HUGE TAX DUES AGAINST THE ASSESSEE AND HE WAS US ED TO RECEIVE REGULAR PHONE CALLS FROM THE INCOME TAX OFFICE AND HIS TAX C ONSULTANT ALMOST ON DAILY BASIS. SINCE HE WAS IN FINANCIAL CONSTRAINT, HE STOPPED ACCEPTING THE CALLS AND ONLY IN THE MONTH OF APRIL, 2011, HE BECAME AWARE OF THE FACT THAT THE PENALTY UNDER SECTION 271D O F THE ACT HAS BEEN CONFIRMED BY THE CIT(A). THIS FACT BECAME KNOWN WHEN THE COUNSEL CONFRONTED HIM. 4. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVEN UE OBJECTED TO THE ADMISSION OF THE APPEAL AFTER SUCH A LONG DELAY. 5. ON THE PERUSAL OF CONDONATION APPLICATION FILED BY THE AS SESSEE ALONG WITH AN AFFIDAVIT FILED IN MARATHI AND ITS ENGLISH TRANSLATIO N, IT IS APPARENT THAT THE PRESENT APPEAL HAS BEEN FILED AFTER A DELAY OF ONE YEAR AND 85 DAYS. THE ASSESSEE CLAIMS THAT HE WAS AN UNDER-GRA DUATE AND WAS ENGAGED IN BUSINESS OF MAKING BRICKS, AGAINST WHIC H, HE HAD BORROWED CERTAIN LOAN FROM BANK OF MAHARASHTRA AND OTHE R BANKS. HOWEVER, BECAUSE OF NON-PAYMENT OF THE INSTALLMENTS, THE BANK LOAN BECAME NPA AND THE FINANCIAL DIFFICULTIES RESULTED IN HIM DEFAULTIN G IN PAYMENT OF TAXES. THE ORDER PASSED BY THE CIT(A) IS DAT ED 20.01.2008 ITA NO.868/PN/2011 RAMCHANDRA S. PARGE 3 AND THE PRESENT APPEAL HAS BEEN FILED ON 16.06.2011. IN T HE TOTALITY OF FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND MERIT IN THE P LEA OF THE ASSESSEE THAT BECAUSE OF SEVERAL PRESSURES OF THE BUSIN ESS AND NON- AVAILABILITY OF FUNDS, THOUGH, HE WAS BEING PRESSURIZED BY T HE COUNSEL TO BE IN HIS CONTACT, BECAUSE OF HIS MENTAL CONDITION AND DEPRESSION, DEFAULTED IN PRESENTING THE PRESENT APPEAL IN TIME. WE FIND MERIT IN THE PLEA OF THE ASSESSEE IN THIS REGARD AND CONDONING THE DELAY IN FILING THE PRESENT APPEAL BEFORE THE TRIBUNAL, WE PROCEED TO H EAR THE APPEAL ON MERITS OF THE CASE. 6. THE ONLY ISSUE RAISED IN THE PRESENT APPEAL IS AGAINST THE LEVY OF PENALTY UNDER SECTION 271D OF THE ACT. 7. THE BRIEF FACTS OF THE CASE ARE THAT, ASSESSMENT IN THE CASE WAS TAKEN UP FOR SCRUTINY ON THE BASIS OF INFORMATION RECEIVED FROM THE ADDL.CIT, CENTRAL RANGE-2, PUNE ON 26.02.2003. DURING THE COURSE OF SEARCH OPERATIONS UNDER SECTION 132 OF THE ACT ON THE PREMISES OF ONE SHRI SHRIRAM SONI ON 29.07.2003 CERTAIN DOCUMENTS AND AC COUNTS WERE SEIZED RELATING TO THE MONEY LENDING BUSINESS CARRIED ON BY THE SAID PERSON. FURTHER, BLANK PROMISSORY NOTES SIGNED BY T HE BORROWERS ALONG WITH BLANK UN-DATED CHEQUES DULY SIGNED BY THE BO RROWERS WERE ALSO FOUND. FURTHER, CHECK LIST OF THE BORROWERS INDICATING THE DUE DATES OF PAYMENT OF INTEREST AND BROKERAGE WAS ALSO FOUN D FROM THE POSSESSION OF THE SAID PERSON. CERTAIN BLANK PROMISSORY NOTES AND CHEQUES OF THE ASSESSEE WERE ALSO FOUND AND AFTER VERIFICA TION OF THE INFORMATION / DOCUMENTS, THE ASSESSING OFFICER ISSUED NOTICE UNDER SECTION 153C OF THE ACT. THE ASSESSEE DURING THE COURS E OF ASSESSMENT PROCEEDINGS WAS CONFRONTED WITH THE FACT THA T HE HAD TAKEN LOAN FROM ONE SHRI SHRIRAM H. SONI AND THERE WERE SIGNED BLANK ITA NO.868/PN/2011 RAMCHANDRA S. PARGE 4 CHEQUES BY THE ASSESSEE TO THE EXTENT OF RS.41,00,000/- FOR WHICH, HE HAD ALSO ISSUED PROMISSORY NOTES. THE ASSESSEE IN THIS C ONTEXT, FILED AN AFFIDAVIT STATING THAT HE HAD NOT RECEIVED ANY CASH LOA NS AND HAD ONLY RECEIVED A SUM OF RS.10,00,000/- BY CHEQUE ON 02.02.2 000. THOUGH, THE ASSESSEE FURNISHED THE DETAILS OF CHEQUE ISSUE D BY THE ASSESSEE AND AFTER GOING THROUGH THE BANK ACCOUNTS FUR NISHED BY THE ASSESSEE, THE ASSESSING OFFICER FOUND THAT THE FACTS NARRA TED BY THE ASSESSEE WERE INCORRECT. IN THE AFFIDAVIT, THE ASSESSEE FURTHER STATED THAT HE WAS ENGAGED IN CERTAIN LOAN PROPOSAL AGAINST WH ICH, HE HAD ISSUED CERTAIN PROMISSORY NOTES AND SIGNED BLANK CHEQUES IN ANTICIPATION OF THE SANCTION OF LOAN PROPOSAL. HOWEVER, THE LOAN PROPOSAL DID NOT MATERIALIZE AND HENCE, NO AMOUNT WAS DISB URSED AS LOAN TO THE ASSESSEE EXCEPT, THE LOAN OF RS.10,00,000/-. THE ASS ESSING OFFICER REJECTING THE PLEA OF THE ASSESSEE AND IN VIEW OF TH E VARIOUS DOCUMENTS SEIZED FROM THE RESIDENCE OF SHRI SONI DURING SE ARCH PROCEEDINGS, TABULATED THE DETAILS OF CASH LOAN AVAILED BY T HE ASSESSEE AT PARA 7 OF THE ASSESSMENT ORDER AND COMPUTED THE IN TEREST @ 18% AND BROKERAGE @ 0.25%. THE ASSESSING OFFICER THUS, MADE A N ADDITION OF RS.2,13,000/- ON ACCOUNT OF INTEREST PAID AND BROKERAGE OF RS.35,500/- WHICH WAS ADDED TO THE INCOME OF THE ASSESS EE FOR THE YEAR UNDER CONSIDERATION. FURTHER, ADDITION ON ACCOUNT OF INTERES T DUE ON THE LOAN RECEIVED THROUGH CHEQUE OF RS.10,00,000/- AT RS.1,80,000/- WAS MADE IN THE HANDS OF THE ASSESSEE. THE REAFTER, PROCEEDINGS UNDER SECTION 271D OF THE ACT WERE INITIATED AGAINST THE ASSESSEE SINCE THE ASSESSEE HAD TAKEN LOAN IN CASH FROM SHRI SONI. IN THE PENALTY PROCEEDINGS, IT WAS POINTED OUT BY THE LEARNE D AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE THAT THERE WAS A DISPA RITY BETWEEN THE AMOUNTS TAKEN UP BY THE ASSESSING OFFICER AND THE AMOU NTS REFLECTED IN THE SEIZED DOCUMENTS. THE ASSESSING OFFICER HAD OBSERV ED THE ITA NO.868/PN/2011 RAMCHANDRA S. PARGE 5 ASSESSEE TO HAVE AVAILED CASH LOAN OF RS.41,00,000/-. HOWE VER, FROM THE DOCUMENTS SEIZED, THE CHEQUES FOUND WITH SHRI SONI W ERE OF RS.31,00,000/- AND THE PROMISSORY NOTES FOUND FROM HIM WE RE OF RS.21,30,000/-. FURTHER, THE ASSESSEE UNDOUBTEDLY, HAD R ECEIVED LOAN OF RS.10,00,000/- IN CHEQUE. THE ASSESSING OFFICER CORRELATED THE DATES, AMOUNTS AND ENTRIES FOUND IN THE SEIZED DOCUMENTS AND POINTED OUT THAT THE LOAN WAS TAKEN DURING THE COURSE OF ASSESSMENT PROCEEDINGS RELATING TO ASSESSMENT YEAR 2002-03 AND FIND A MENTION ON DIFFERENT DOCUMENTS I.E. ON PAGE 83 OF BUNGLE 98, THERE WAS MENTION OF LOAN OF RS.11,00,000/- TAKEN ON 29.06.2001. FURTH ER, ON PAGE 23 OF BUNDLE 99 AND PAGE 55 OF BUNDLE 99 I.E. 29.07.200 1 AND 26.12.2001, THE AMOUNT OF RS.11,00,000/- EACH WAS MENTIONE D. THE ASSESSING OFFICER WAS OF THE VIEW THAT IF THE ASSESSEE HAD NOT TAK EN THE SAID LOANS, THERE WAS NO NEED FOR ISSUE OF PROMISSORY NOTE S DULY SIGNED BY THE ASSESSEE, WHICH WERE FOUND FROM THE POSSES SION OF THE PERSON SHRI SONI. IN VIEW THEREOF, THE ASSESSEE WAS HELD TO HAVE VIOLATED THE PROVISIONS OF SECTION 269SS OF THE ACT AND PE NALTY OF RS.11,00,000/- WAS LEVIED UNDER SECTION 271D OF THE ACT. 8. THE CIT(A) OBSERVED ON THE BASIS OF SEIZED DOCUMENTS T HAT REASONABLE INFERENCE COULD BE DRAWN TO SHOW THAT THE AS SESSEE HAD INDEED, TAKEN LOAN IN CASH FROM SHRI SONI FOR WHICH, BLANK CHE QUES AS WELL AS PROMISSORY NOTES WERE FOUND AND SEIZED FROM HIM. THE COMPUTERIZED DETAILS ALSO REFLECTED THE TRANSACTIONS OF VAR IOUS PERSONS IN RESPECT OF MONEY BORROWED FROM THEM BY SHRI SONI OR LOAN GIVEN BY SHRI SONI. THE ASSESSEE HAD FAILED TO EXPLAIN ANY REASONAB LE CAUSE FOR ACCEPTING SAID LOAN IN CASH. ACCORDINGLY, THE ORDER OF AS SESSING OFFICER IN HOLDING THE ASSESSEE TO HAVE VIOLATED THE PROVISIO NS OF SECTION 269SS OF THE ACT AND BEING LIABLE TO LEVY OF PENALTY OF ITA NO.868/PN/2011 RAMCHANDRA S. PARGE 6 RS.11,00,000/- UNDER SECTION 271D OF THE ACT WAS UPHELD BY THE CIT(A). 9. THE ASSESSEE IS IN APPEAL AGAINST THE SAID ORDER OF CIT (A). THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE AFTER TAKING US THROUGH THE FACTS POINTED OUT THAT THERE WAS A PRESUM PTION THAT CASH LOAN HAS BEEN TAKEN BY ASSESSEE. HOWEVER, THE ASSESSEE HAD DEN IED TO HAVE RECEIVED ANY CASH LOANS AND IT WAS NOT POSSIBLE TO ESTABLISH SOMETHING WHICH HAD NOT HAPPENED. FURTHER, THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE A SSESSING OFFICER HAD ACCEPTED THE EXPLANATION OF THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS. OUR ATTENTION WAS DRAWN TO TH E ANNEXURE A ANNEXED TO ASSESSMENT ORDER AND IT WAS POINTED OUT TH AT PERUSAL OF THE SAME WOULD REFLECT THAT ON 29.06.2001 THERE WAS AN ENTRY OF 1100 AGAINST WHICH, PARGE IS MENTIONED IN HAND. IT WAS FURTHER POINTED OUT BY THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESS EE THAT THE ASSESSING OFFICER COMPUTED CASH LOANS OF RS.30,00,000/- BUT THE PROMISSORY NOTES OF RS.31,00,000/- AND NOT RS.41,00,000/- W ERE FOUND. THE ASSESSING OFFICER WHILE COMPLETING ASSESSMENT HAD CHARGED INTEREST AT LOAN OF RS.30,00,000/- AND THERE WAS NO CHARGING OF INTEREST ON THE BALANCE CASH LOAN OF RS.11,00,000/-. RE LIANCE WAS PLACED ON THE RATIO LAID DOWN IN ITA NO.520/PN/2008 IN DY.C IT VS. M/S. SNEH BUILDERS & ANOTHER. 10. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE PLA CED RELIANCE ON THE ORDER OF CIT(A). 11. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. UNDER THE PROVISIONS OF SECTION 269SS OF THE ACT, IT IS PRO VIDED THAT, ITA NO.868/PN/2011 RAMCHANDRA S. PARGE 7 NO PERSON AFTER 30.06.1984 SHALL TAKE OR ACCEPT ANY LOAN OR DEPOSIT FROM ANY OTHER PERSON, OTHERWISE THAN BY A ACCOUNT PAY EE CHEQUE OR ACCOUNT PAYEE DRAFT WHERE THE AMOUNT OF LOAN OR DEPOSIT IS RS.20,000/- OR MORE. IN CASE, THE PROVISIONS OF SECTION 26 9SS OF THE ACT ARE VIOLATED THAT ANY PERSON ACCEPTS LOAN OR DEPO SIT OF RS.20,000/- OR MORE IN CASH FROM ANY OTHER PERSON THEN, THE SAID PER SON IS EXIGIBLE TO LEVY OF PENALTY UNDER SECTION 271D OF THE ACT WHICH WO ULD BE EQUAL TO THE AMOUNT OF LOAN OR DEPOSIT SO TAKEN OR ACCEPTED. 12. NOW, COMING TO THE FACTS OF THE PRESENT CASE, SEARCH AND SEIZURE OPERATIONS WERE CARRIED OUT UNDER SECTION 132 OF THE AC T IN CASE OF ONE SHRI SHRIRAM H. SONI ON 29.07.2003. CERTAIN DOCUMENTS AND BOOKS OF ACCOUNT WERE FOUND AND SEIZED FROM HIS PREMISES WHICH RELA TED TO THE MONEY LENDING BUSINESS CARRIED ON BY THE SAID PERSON. F URTHER, CERTAIN DOCUMENTS RELATING TO ADVANCES OF CASH LOANS WER E ALSO FOUND. ON VERIFICATION OF THE DOCUMENTS AND INFORMATION RECEIVED FRO M THE OFFICER IN-CHARGE OF SHRI SHRIRAM H. SONI, THE ASSESSING OFFICER OF THE ASSESSEE BEFORE US WAS ISSUED NOTICE UNDER SECTION 153C OF THE ACT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESS EE WAS CONFRONTED WITH THE INFORMATION THAT HE HAD TAKEN LOAN FR OM SHRI SHRIRAM H. SONI TO THE EXTENT OF RS.41 LAKHS FOR WHICH, HE HAD ALSO ISSUED PROMISSORY NOTES. IN REPLY, THE CLAIM OF THE ASSES SEE WAS THAT HE HAD RECEIVED ONLY RS.10 LAKHS ON 02.02.2000 BY WAY O F CHEQUE AND NO OTHER AMOUNT WAS RECEIVED, THOUGH HE HAD GIVEN CERT AIN PROMISSORY NOTES AND SIGNED BLANK CHEQUES IN ANTICIPATION OF SANCTION OF LOAN PROPOSAL. THE ASSESSEE CLAIMS THAT NO SUCH LOAN PROPOSAL WAS COMPLETED OR ANY MONEY WAS DISBURSED TO HIM. THE SAID E XPLANATION OF THE ASSESSEE WAS REJECTED, AFTER GOING THROUGH THE P ROMISSORY NOTES, SIGNED BLANK CHEQUES AND CHEQUE LIST SEIZED FROM THE PREM ISES OF THE ITA NO.868/PN/2011 RAMCHANDRA S. PARGE 8 SEARCHED PERSON, THAT THE AMOUNTS MONTH-WISE WERE MEN TIONED AGAINST ASSESSEES NAME AND ALSO INTEREST WAS CHARGED AT 18% AND BROKERAGE AT 0.25%. THE ASSESSING OFFICER UNDER PARA 7 H AS TABULATED THE DETAILS OF CASH LOANS AVAILED BY THE ASSESSEE DURING THE FINANCIAL YEAR 2001-02, WHICH IN TURN, WERE EXTRACTED FROM THE DOC UMENTS, INFORMATION SEIZED AND WHICH READ AS UNDER: MONTH AMOUNT INTEREST (@ 18%) BROKERAGE (@0.25%) 1. APRIL 2001 RS.5,00,000/- RS.7,500/- RS.1,250/- 2. MAY 2001 RS.20,00,000/- RS.30,000/- RS.5,000/- 3. JUNE 2001 RS.5,00,000/- RS.7,500/- RS.1,250/- 4. JULY 2001 RS.5,00,000/- RS.7,500/- RS.1,250/- 5. AUGUST 2001 RS.20,00,000/- RS.30,000/- RS.5,000/- 6. SEPTEMBER 2001 RS.1,60,000/- RS.24,000/- RS.4,000/- 7. OCTOBER 2001 RS.5,00,000/- RS.7,500/- RS.1,250/- 8. NOVEMBER 2001 RS.30,00,000/- RS.45,000/- RS.7,500/- 9. DECEMBER 2001 RS.21,00,000/- RS.31,500/- RS.5,250/- 10. JANUARY 2001 RS.5,00,000/- RS.7,500/- RS.1,250/- 11. FEBRUARY 2001 RS.10,00,000/- RS.15,000/- RS.2,500/- --------------------------------------------- TOTAL RS.2,13,000/- RS.35,500/- --------------------------------------------- 13. THE ASSESSING OFFICER VIDE PARA 8 HAD OBSERVED THAT THE ASSESSE E HAD AVAILED THE CASH LOAN AS MENTIONED ABOVE AND FOR THE SAME, ASSESSEE HAD PAID INTEREST OF RS.2,13,000/- AND BROKERA GE OF RS.35,500/- BY CASH WHICH IN TURN, WAS NOT DISCLOSED IN TH E RETURN OF INCOME. HENCE, THE SAME WAS TREATED AS UN-EXPLAINED EXP ENDITURE ON ACCOUNT OF BOTH INTEREST AND BROKERAGE AND ACCORDINGLY ADDED TO THE INCOME OF THE ASSESSEE. FURTHER, AN ADDITION WAS MADE ON ACCOUNT OF INTEREST ON THE LOAN OF RS.10 LAKHS RECEIVED BY CHEQUE W HICH TOTALS TO RS.1,80,000/-. THE ASSESSING OFFICER DURING THE PROCEEDINGS RELATING TO LEVY OF PENALTY UNDER SECTION 271D OF THE ACT, NOTED T HE ABOVE FACTS AND OBSERVED THAT THE SEIZED DOCUMENTS I.E. PAGE 83 OF B UNDLE 98 CONTAINED AN ENTRY RELATING TO THE ASSESSEE THAT SHOWE D A FRESH LOAN OF RS.11 LAKHS TAKEN BY SHRI PARGE FOR A PERIOD OF 90 DAYS @ INTEREST 2% PER MONTH. THE COPY OF THE SAID PAGE (SEIZED DOCUMENT) W AS ANNEXED AS A TO THE PENALTY ORDER. THE ASSESSING OFFICER FURTHE R ANALYZED THE DOCUMENTS AND OBSERVED THAT THE SAME LOAN WAS CARRIED FORWARDED ON ITA NO.868/PN/2011 RAMCHANDRA S. PARGE 9 27.09.2001 I.E. BUNDLE 99 PAGE 23 AND SUBSEQUENTLY ON 26.1 2.2001 I.E. BUNDLE 99 AT PAGE 55. THE BLANK CHEQUES OF MATCHING AMOUNT WERE ALSO FOUND ALONG WITH PROMISSORY NOTES DURING SEARCH OPERATIONS. THE ASSESSING OFFICER IN VIEW OF THE SAID CASH LOAN OF RS.11 LAKHS HELD THE ASSESSEE TO HAVE CONTRAVENED THE PROVISIONS OF SEC TION 269SS OF THE ACT AND LEVIED PENALTY OF RS.11 LAKHS UNDER SECTION 27 1D OF THE ACT. THE FIRST ENTRY OF RS.11 LAKHS AS MENTIONED AT PAGE 83, BUNDLE 98 I.E. ACCEPTANCE OF CASH LOAN OF RS.11 LAKHS IS ON 29.06.20 01. THE ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT UNDER SEC TION 143(3) OF THE ACT HAS TABULATED THE DETAILS OF CASH LOAN RE CEIVED BY THE ASSESSEE AND THE SAME HAS BEEN REPRODUCED BY US HER EINABOVE. THE PERUSAL OF THE SAME REFLECTS THAT WHILE COMPLETING THE ASSE SSMENT UNDER SECTION 143(3) OF THE ACT FOR THE MONTH OF JUNE, 20 01 AND EVEN FOR JULY, 2001, THE LOAN AMOUNT OF RS.5 LAKHS HAS BEEN TAKEN INTO ACCOUNT AND THE INTEREST @ 18% HAS BEEN WORKED OUT O N THE SAME. NO COGNIZANCE HAS BEEN TAKEN OF CASH LOAN OF RS.11 LAKHS WHIC H, AS PER THE SEIZED DOCUMENTS WAS ALLEGEDLY RECEIVED ON 29.06.2001. 14. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVE NUE HAS DURING THE COURSE OF HEARING FURNISHED ON RECORD THE SA ID ANNEXURE A TO THE PENALTY UNDER SECTION 271D OF THE ACT. THE PER USAL OF THE SAID DOCUMENT REFLECTS NOTING ON THE SAID SHEET IN THE NAME O F ONE SHRI PARGE WHICH IS A GENERAL NAME AND DOES NOT ESTABLISH THA T THE SAID LOAN HAD ACTUALLY BEEN DISBURSED TO THE ASSESSEE BEFORE US, WHO IS RAMACHANDRA S. PARGE. OTHERWISE ALSO, THE ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT UNDER SECTION 143(3) OF THE ACT HAD NOT INCLUDED THE SAID SUM OF RS.11 LAKHS AS PART OF THE CASH LO ANS RECEIVED BY THE ASSESSEE ON WHICH ALLEGEDLY, THE INTEREST AND BRO KERAGE HAD BEEN PAID BY THE ASSESSEE, WHICH HAD NOT BEEN DECLA RED BY THE ITA NO.868/PN/2011 RAMCHANDRA S. PARGE 10 ASSESSEE AND HENCE, ADDITION WAS MADE IN THE HANDS OF TH E ASSESSEE. IN THE TOTALITY OF THE ABOVE FACTS AND CIRCUMSTANCES, WE FIND NO MERIT IN THE LEVY OF PENALTY UNDER SECTION 271D OF THE ACT AS T HE ASSESSING OFFICER HAS FAILED TO ESTABLISH THE RECEIPT OF CASH LOANS BY TH E ASSESSEE. EVEN OTHERWISE, IN THE ABSENCE OF CONSIDERING THE SAID CAS H LOAN OF RS.11 LAKHS IN THE HANDS OF THE ASSESSEE WHILE COMPLETING A SSESSMENT UNDER SECTION 143(3) OF THE ACT, WE FIND NO MERIT IN THE O RDERS OF THE AUTHORITIES BELOW IN HOLDING THE ASSESSEE TO HAVE CONTRAV ENED THE PROVISIONS OF SECTION 269 SS OF THE ACT TO THE EXTENT OF RS.11 LAKHS. WE ACCORDINGLY, DIRECT THE ASSESSING OFFICER TO DELETE THE PENALTY LEVIED UNDER SECTION 271D OF THE ACT AT RS.11 LAKHS. THE GROUN DS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, ALLOWED. 15. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 25 TH DAY OF NOVEMBER, 2014. SD/- SD/- (G.S. PANNU) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE, DATED: 25 TH NOVEMBER, 2014. GCVSR COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-II, PUNE; 4) THE CIT-II, PUNE; 5) THE DR B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// ASSISTANT REGISTRAR I.T.A.T., PUNE