ITO Vs Paharhati O Uttar Memari Co-operative Agricultural Marketing Society Limited (ITAT Kolkata)
ITAT Kolkata held the penalty under section 271E of the Income Tax Act not leviable since in the present case there was no repayment of loan received from the members but it was loan disbursed to members. Accordingly, revenue appeal dismissed.
Facts- Revenue has preferred the present appeal against the deletion of penalty of ₹1,00,40,222/- which had been imposed u/s 271E of the Act for violation of provisions of Section 269T of the Act.
Conclusion- Held that Section 269T is applicable on repayment of loan in cash in case of the borrower and in the assessee’s case it was not the repayment of loan received from the members but was the loan disbursed to the members. No evidence has been filed by the Revenue in support of the claim that the amount was not disbursed as loan to the members in cash but was repayment of loan to the members. As is mentioned in para 7, the Ld. AO on one hand added the amount to the income of the assessee and on the other hand has treated the same amount as loans for the purpose of section 269T, which provision otherwise is not even applicable to the facts of the case. Hence, the initiation of the penalty has been done on incorrect appreciation of the provisions of Section 269T of the Act and no penalty u/s 271E of the Act is leviable and there is no reason to disturb the findings of the Ld. CIT(A).
