Penalty cannot be levied on bonafide transaction with no intention to evade tax and where default was of technical nature

CA Mayank Parekh

Facts:

The assessee company was engaged in the business of manufacturing and trading of fertilizers. Fertilizers manufactured by the assessee were sold to farmers and various farmers co-operative societies by salesman appointed by the assessee. On sudden requirement of the business the assessee during Assessment Year (‘AY’) 2003-04 obtained cash loans in excess of Rs 20,000 from various part

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