Case Law Details
CIT Vs. M/s Al- Ameen Educational Trust (Kerala High Court)
Tribunal erred egregiously in deleting the penalty levied under Section 271D, on the facts disclosed and cause shown, which approach and conclusions are perverse. The assessee failed to discharge its burden in proving that there was a reasonable cause in accepting the deposits from staff members other than by way of cheque or draft. The Tribunal failed to appreciate the import of Section 271D in the correct perspective. We answer the questions of law arising from the order of the majority, against the assessee and in favor of the Revenue.
FULL TEXT OF THE HIGH COURT JUDGMENT / ORDER IS AS FOLLOWS
The Revenue is in appeal against the common order of the Tribunal for the assessment years 2005-06 and 2006-07. The issue relates to acceptance of loans and deposits other than by way of Cheque or Draft, in violation of Section 269SS of the Income Tax Act, 1961 [for brevity “the Act”] and the resultant penalty levied under Section 271D, totaling the amounts so accepted. The Bench of two members of the Tribunal wrote split verdicts. The Administrative Member (for brevity “AM”] affirmed the orders of the Additional Commissioner, as affirmed by the first appellate authority; remanding to the extent of further verification of the loan of Rs. 49,00,000/- received from the daughter of the President of the Trust. The Judicial Member [for brevity “JM”], however, did not agree with the AM and wrote a separate order finding the explanation offered by the assessee to be satisfactory to enable the assessee to be absolved of the penalty under Section 273B; by reason of which the matter was placed before a third member. The third member, the Vice-President of the Tribunal concurred with the JM’s order.
2. The questions of law arising from the above order, as framed by another Division Bench of this Court while admitting the appeals, are as follows:
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