Case Law Details
Brief of the Case
ITAT Mumbai held In the case of Jayantilal Vaishnav HUF vs. JCIT that the reasonable cause u/s 273B need to be seen from the context of the situation where a person is reasonably and under bonafide belief of taking a action beyond his control i.e. cause which prevent a reasonable person in ordinary prudence acting under normal circumstances for taking such action. The reasonable cause has to be seen in the the judicious manner by stepping up in the shoes such person as to what were the circumstances under which he acted upon. In the given case the assessee has made repayments in cash for which he had given explanation and reasons that out of such payments substantial amount paid to legal heirs of deceased creditors who refused to accept cheque, which in our opinion falls within the coverage of reasonable cause u/s 273B.
Facts of the Case
The assessee is engaged in the business of manufacturing of chemical. There were some loans which were coming over from earlier years and were repaid during the year in cash amounting to Rs.13,72,233/- because the assessee was under financial problems and loan creditors refused to accept payment by cheque. The AO imposed penalty of Rs.13,72,233/- after initiating the penalty proceedings u/s 271E of for contravention of section 269T by rejecting the plea of assessee without doubting the genuineness of these loans.
Contention of the Assessee
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