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TAXAP/2074/2009 3/ 3 ORDER
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
TAX
APPEAL No. 2074 of 2009
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COMMISSIONER
OF INCOME TAX-IV - Appellant(s)
Versus
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MEDIA ENTERTAINMENT LTD - Opponent(s)
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Appearance
:
MR
MANISH R BHATT Sr Advocate with Ms MAUNA M BHATT
for
Appellant
None for
Opponent
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CORAM
:
HONOURABLE
MR.JUSTICE AKIL KURESHI
and
HONOURABLE
MS JUSTICE SONIA GOKANI 4th April 2011
ORAL
ORDER
(Per
: HONOURABLE MR.JUSTICE AKIL KURESHI)
Revenue
is in Appeal against the order of the Tribunal dated 1st
May 2009, raising following question for our consideration :-
“Whether
the Appellate Tribunal is right in law and on facts in confirming
the order passed by CIT [A] in deleting the penalty of Rs.
60,97,000/= levied u/s. 271E, for violation of provisions made u/s.
269T of the Act ?”
It
can be seen from the question itself that the issue pertains to levy
of penalty u/s. 271E of the Income Tax Act, 1961. The Assessing
Officer was of the opinion that certain amounts were received by the
assessee in cash breaching the provisions of Section 269T of the Act.
The Assessing Officer, therefore, instituted penalty proceedings
under Section 271E of the Act and eventually imposed the penalty,
which was carried in appeal by the assessee. The
CIT [A] deleted the penalty. The Revenue carried the issue further in
appeal before the ITAT. The Tribunal confirmed the order of the CIT
[A].
Counsel
for the Revenue vehemently contended that the entire mode of
accepting and returning the money in cash on the premise that the
flats were booked and later on, bookings were cancelled is not
believable or acceptable. He contended that the properties were never
sold and the cancellation is shown several years after the initial
acceptance of the money in cash. The Assessing Officer thus rightly
believed breach of Section 269T of the Act.
We,
however, find that the CIT [A] in its Order observed that there is no
dispute regarding genuineness of the transactions, and the source of
funds are proved and are not doubted. It was further observed that
the sale and purchase were cancelled after two-three years on account
of earthquake and such time gap cannot suggest that the appellant’s
claim of purchase and sale of the flats earlier was not genuine. We,
therefore, believe that the receipt of cash against the sale of flats
and payment of cash against the purchase of the flats was not within
the purview of loan or deposit, and therefore, not in violation of
Section 271T of the Act. No penalty under Section 271E of the Act,
therefore, could have been imposed.
The
Tribunal also concurred with the view of the CIT [A] observing that
the Assessing Officer simply doubted the transactions for purchase
and sale but did not bring any evidence on record that the
transactions were not genuine. The Tribunal further observed that the
transactions for purchase and sale
of the properties cannot be regarded to be transactions for receiving
or advancing the loan.
We
find that CIT [A] as well as Tribunal found on facts that the amounts
received on sale of flats cannot be regarded to be transactions for
receiving or advancing the loan, the same did not breach Section 269T
of the Act. In the result, no substantial question of law arises.
Tax Appeal is dismissed.
{Akil
Kureshi, J.}
{Ms.
Sonia Gokani, J.}
Prakash*
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