Matri Bhumi Agritech LLP Vs ITO (ITAT Kolkata)
The Income Tax Appellate Tribunal (ITAT), Kolkata partly allowed the appeal filed by Matri Bhumi Agritech LLP against the order of the Commissioner of Income Tax (Appeals)-NFAC confirming penalty of Rs. 3,30,77,252 imposed under Section 271D of the Income Tax Act for alleged violation of Section 269SS.
The assessee had originally filed its return for AY 2017-18 declaring a loss, which was later assessed under Section 143(3). Subsequently, a notice under Section 274 read with Section 271D was issued alleging that the assessee accepted cash repayments exceeding Rs. 20,000 from rentiers/farmers during FY 2016-17 in contravention of Section 269SS. The penalty order was passed on 26.09.2022.
Before the CIT(A), the assessee contended that the amounts received in cash were not deposits or loans accepted from farmers, but repayments of advances earlier provided to them. The assessee also argued that no notice had been received from the National Faceless Penalty Unit and that principles of natural justice had been violated. However, the CIT(A) upheld the penalty, observing that the assessee had admitted receipt of loan repayments in cash and failed to establish any exception under Section 269SS. The CIT(A) concluded that the amounts credited in the books constituted deposits or loans received in cash and therefore attracted penalty under Section 271D.
