S.269SS not applies to transfer between two accounts by Journal Entry

Section 269SS is attracted when the loan or deposit taken or accepted otherwise than by account payee cheque or account payee bank draft and in the Explanation (iii) below Sec.2 69SS, it is mentioned that loan or deposits means “loan or deposit of money” and transfer between two accounts by way of journal entry does not imply receipt of loan or deposit in money terms. When there is no violation of Section 269SS there is no question of levy of penalty of u/s.271D. The penalty of Rs. 24,74,700/- (sic.) is thus directed to be deleted.

ITAT “D” BENCH, AHMEDABAD

BEFORE SHRI MUKUL Kr.SHRAWAT, JUDICIAL MEMBER And
SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER

I.T.A. No.643/Ahd/2010
Assessment Year: 2006-07)

Income-tax Officer 

Vs.  

Shri Mineshkumar Shantilal Patel  

Date of Hearing: 09/11/2012
Date of Pronouncement: 4^th Jan-2013

O R D E R

PER SHRI MUKUL Kr. SHRAWAT, JUDICIAL MEMBER :

This is an appeal filed by the Revenue arising out of the order of ld.CIT(A)-V, Baroda Ahmedabad dated 31.12.2009 passed for A.Y. 2006-07 and the grounds raised are as follows:-

1.   On the facts and in the circumstances of the case, the learned CIT(A) erred in deleting the penalty of Rs. 24,74,000/- levied u/s.271D of the Act for contravention of provisions of section 269SS of the Act.