The Income Tax Appellate Tribunal (ITAT), Raipur Bench, has recently, in an appeal filed before it, on finding about the failure of the assessee to comply with the provisions of section 269T, upheld the penalty under section 271E of the Income Tax Act, 1961.
The aforesaid observation was made by the Raipur ITAT, when an appeal was preferred before it by the assessee, as directed against the order passed by the Commissioner of Income-Tax (Appeals), National Faceless Appeal Center (NFAC), Delhi, which in turn arises from the order passed by the JCIT, Raipur, under Section 271E of the Income-tax Act, 1961, for assessment year 2015-16.
The Controversy involved in the appeal being the sustainability of the penalty imposed by the JCIT under Section 271E of the Income Tax Act, the brief facts of the case were that the AO, while framing the assessment in the case of the assessee for A.Y 2015-16 observed, that the assessee had made cash repayment of loans that were raised by her from M/s. Tata Motors and M/s. Tata Finance Ltd, for financing purchase of buses.
On the basis of the information shared by the AO with the JCIT, Range-3, Raipur, the latter called upon the assessee to show cause, as to why penalty may not be imposed upon her under Section. 271E of the Income Tax Act, for having repaid the loans in question otherwise than as per the modes prescribed in Section 269T. In reply, it was the claim of the assessee that the monthly instalments towards repayment of the aforementioned loans were made in cash because the concerned financers had insisted her to do so.
In order to fortify her aforesaid contention, the assessee placed on record a letter dated 05.11.2012 from M/s. Tata Motors Pvt. Ltd., which revealed that she was called upon by the financiers concerned to make repayment of the loans in cash. In the backdrop of the aforesaid facts, it was submitted by the assessee that as she was prevented by a reasonable cause for not making the repayment of the monthly instalments of the loans in question through cheque, coupled with the fact that she was ignorant of the provisions of Section 269T of the Income Tax Act, therefore, as per the mandate of Section 273B, no penalty in all fairness was liable to be imposed upon her under Section 271E of the Income Tax Act.
The JCIT after deliberating on the explanation of the assessee was however, not persuaded to subscribe to the same. It was observed by the JCIT that as the assessee at the relevant point of time was assisted by a Chartered Accountant who had duly audited her books of accounts; and therefore, her aforesaid claim did not merit acceptance.
Accordingly, the JCIT was of the view that the assessee had without any reasonable cause repaid the loans in contravention of the provisions section 269T of the Income Tax Act, and he therein saddled her with a penalty of Rs.6,71,939/- under Section. 271E. And it is being aggrieved by the same that the assessee has preferred the instant appeal before the Raipur Tribunal.
Hearing the opposing contentions of both sides as presented by Shri Bikram Jain, CA on behalf of the assessee and by Shri Piyush Tripathi, the Sr. DR on behalf of the Revenue, the ITAT coram of Arun Khodpia, the Accountant Member, and Ravish Sood, the Judicial Member, held:
“The assessee had not only failed to comply with the provisions of section 269T of the Act, therein rendering her liable for imposition of penalty under Section. 271E of the Act, but had also failed to come forth with any reasonable cause which had prevented her to make repayment of the monthly instalments of her outstanding loans in a manner other than that prescribed under law, therefore, finding no infirmity in the penalty of Rs. 6,71,939/- imposed by the JCIT under Section. 271E of the Income Tax Act, uphold the same.”
Resultantly, the appeal filed by the assesseewas dismissed.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
