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| The Tax Publishers2020 TaxPub(DT) 0244 (Bang-Trib) INCOME TAX ACT, 1961
Section 271D
Where loan accepted by assessee through bearer cheque, was taken from his father for meeting his urgent business needs, the said transaction between father and son would not attract imposition of penalty under section 271D and hence, the penalty levied under section 271D would not be sustainable.
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Penalty under section 271D - Contravention of section 269SS - Loan accepted though bearer cheque - Loan accepted from father
AO noticed that assessee accepted loan through bearer cheque. Accordingly, he levied penalty under section 271D for violating provisions of section 269SS. Assessee submitted that the said loan was taken from his father, which was required for his urgent business needs i.e. for purchase of petroleum products. Accordingly, he submitted that as the transaction was between the father and the son and as the amount was received through bearer cheque to meet the urgent needs, therefore, the penalty would not be leviable. Held: Assessee demonstrated that he took impugned loan from his father due to urgent business needs, which was not considered by Revenue. Further, both the father and the son were assessed to tax and were maintaining regular books of account and except technical violation there was no escapement of income or suppression of income in the instant case. Further, though the transaction was between two independent business organizations but the same remained between father and son, which would not attract imposition of penalty under section 271D. Hence, the penalty levied under section 271D would not be sustainable.
Followed:Deepika, v. Addl. CIT [in ITA No.561/Bang/2017, dt. 13-10-2017]
REFERRED :
FAVOUR : In assessee's favour
A.Y. : 2014-15
INCOME TAX ACT, 1961
Section 271E
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