Case Law Details
Shri Venkat Narayana Raju Pasuparthy Vs Addl. CIT (ITAT Hyderabad)
Assessee has stated before the CIT (A) that the loans were taken in cash on account of his sister’s marriage and that the loans were repaid through banking channels by way of RTGS and therefore, the genuineness of the loan and the identity of the creditor has been established. We find that the penalty u/s 271D is subject to the provisions of section 273B of the Act. Therefore, penalty u/s 271D is not automatic and when the assessee provides a reasonable explanation, the penalty is not leviable. The assessee’s contention that the loans were taken for the marriage of his sister has not been found to be incorrect and also the fact that the loans have been repaid by cheques is not controverted.
In the light of the aforesaid, we are of the view that reasonable cause had been shown by the assessee and the provisions of Section 273B of the Act was applicable.
We are satisfied that there existed reasonable cause for the assessee accepting the loans in cash and particularly since the loans have been repaid by way of RTGS. Therefore, we delete the penalty levied by the AO u/s 271D of the Act and confirmed by the CIT (A).
FULL TEXT OF THE ITAT JUDGEMENT
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