Law:

Section:

Section 271D, read with section 271E of Income-tax Act, 1961 - Penalty - For failure to comply with section 269SS - Assessment year 1989-90 - Assessing Officer levied penalty on assessee under sections 271D and 271E on ground that assessee had contravened provisions of sections 269SS and 269T by accepting cash loans exceeding Rs. 20,000 - On appeal, Commissioner (Appeals) deleted said penalty holding that contravention alleged against assessee did not result in any unaccounted transaction such as lending and repayment and that both lending and repayment were entered in books of assessee and figures involved were meager and was incurred only for meeting sudden demand of over draft account - Tribunal upheld said order - Whether on facts, it could be said that there was reasonable cause for assessee not strictly complying with provisions of section 269SS and, therefore, no penalty under sections 27ID and 27IE could be imposed - Held, yes FACTS The Assessing Officer levied penalty under sections 271D and 271E on ground that the assessee had contravened the provisions of sections 269SS and 269T by accepting cash loans exceeding Rs. 20,000. On appeal, the Commissioner (Appeals) deleted the penalty by holding that the contravention alleged against the assessee did not result in any unaccounted transaction such as lending and repayment and that both the lending and repayment were entered in the books of account of the assessee and the figure involved was meager and that the same was incurred only for meeting the sudden demand of overdraft account. The appeal filed by the revenue was dismissed by the Tribunal. On appeal: HELD In the instant case, the Tribunal after endorsing the findings of the Commissioner (Appeals) that the contravention alleged against the assessee did not result in any unaccounted transaction such as lending and repayment and that both the transactions were entered in the books of the assessee and the figure involved was also meager and that the same was incurred only for meeting the sudden demand of overdraft account, found that the order of the Commissioner (Appeals) was a well reasoned one and the same did not suffer from any infirmity requiring…

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