ITAT Annuls Penalty u/s 273B for Cash Payment of Defaulted EMI

Shri Sankaranarayanan R. Sundar Raj Vs ITO (ITAT Chennai) In a noteworthy verdict, the Income Tax Appellate Tribunal (ITAT) Chennai has overturned a penalty imposed under Section 271E on Sankaranarayanan R. Sundar Raj. The assessee’s cash payment towards a defaulted EMI instalment, following a cheque bounce, was deemed a ‘reasonable cause’ under Section 273B, thereby leading to the deletion of the penalty. Analysis:- The case revolved around an addition of Rs. 5 Lacs as unexplained money under Section 69A, representing cash paid by the assessee towards the settlement of a veh...