HIGH COURT OF GUJARAT
Income-tax Officer, Ward 5(2), Baroda
Versus
VS Hostel
Tax Appeal Nos. 1463 & 1466 of 2011
September 18, 2012
ORDER
Harsha Devani, J.
Both these appeals under section 260A of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) have been filed by the revenue against the common order dated 10.6.11 passed by the Income Tax Appellate Tribunal (hereinafter referred to as “the Tribunal”). Before the Tribunal two separate orders passed by the Commissioner (Appeals) cancelling penalties under section 271D and 271E of the Act were subject matter of challenge. Since common facts are involved in both these appeals and the parties are also common, the same were taken up for hearing together and are disposed of by this common judgment.
2. The appellant has challenged the impugned order by proposing the following questions:
Tax Appeal No.1463 of 2011
“Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in upholding the order of the CIT(A), who deleted the entire penalty of Rs.24,52,740/- levied under Section 271D of the Income Tax Act, 1961 without considering the fact that there was no reasonable cause for the assessee to indulge into cash transactions in violation of Section 269SS of the Act ?”
Tax Appeal No.1466 of 2011
“Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in upholding the order of CIT(A) who deleted the entire penalty of Rs.30,92,911/- levied under Section 271E of the Income Tax Act, 1961 without considering the fact that there was no reasonable cause for the assessee to indulge into cash transactions in violation of Section 269T of the Act?”
3. The assessment year is 2004-2005. In the year under consideration, the Additional Commissioner of Income-tax noticed that the assessee had accepted and repaid the following amounts of loans/deposits otherwise than by cross-cheques/drafts in contravention of the provisions of section 269SS and 269T of the Act:
