Neetaben Patel Vs ITO (ITAT Ahmedabad)
Penalty U/s 271D & 271E Deleted – Cash Loans for Son’s Education Held Genuine – Reasonable Cause U/s 273B Established – ITAT Ahmedabad
The assessee received and repaid cash loans exceeding prescribed limits from friends and relatives to arrange funds for bank loan sanction for her son’s overseas education. JCIT levied penalties u/s 271D & 271E for violation of ss.269SS & 269T, which were confirmed by CIT(A).
ITAT observed that the assessee, a widow with agricultural background, had demonstrated genuineness of transactions, linkage with sanctioned bank loan and bona fide circumstances. The Tribunal held that the authorities failed to properly consider the assessee’s explanation and that such genuine transactions constituted “reasonable cause” within the meaning of s.273B. Relying on judicial precedents including A.B. Shanthi, ITAT deleted the penalties, holding that bona fide belief and absence of tax evasion intent justified relief. Appeals allowed.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
These two appeals are filed by the Assessee as against two orders both dated 17-03-2025 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, (in short referred to as “CIT(A)”), arising out of the penalties levied under section 271D and 271E of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) relating to the same Assessment Year 2011-12.
