LODHA BUILDERS PVT. LTD. Vs. ACIT
INCOME TAX APPELLATE TRIBUNAL
Lodha Builders Pvt. Ltd.
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D.Karunakara Rao, Member (A) -
(1.) THERE are 7 appeals under consideration involving seven different assessees. These are the sister concerns belonging to Lodha Group. All these appeals are filed by the assessees involving AY 2009 -2010 against the common order of the CIT (A) -38, Mumbai, dated 31.12.2013 involving penalty u/s. 271D of the Act. Levy of penalty u/s. 271D/E of the Income Tax Act is the issue in these appeals and the CIT (A) passed separate orders, dated same involving penalty u/s. 271E. Since, the issues raised by the assessees in all the seven appeals are identical. Therefore, for the sake of convenience, they are clubbed, heard combinedly and disposed of in this consolidated order. Appeal wise and ground wise adjudication is given in the following paragraphs. To start with, we shall undertake to adjudicate the appeal in the case of Lodha Builders Pvt. Ltd. in the succeeding paragraphs involving two penalties u/s. 271D & 271E of the Act.
(2.) THIS appeal ITA No. 476/M/2014 filed by the assessee on 21.1.2014 is in connection with penalty levied u/s. 271D of the Act and the effective grounds raised in the appeal read as under:
1. On the facts and in the circumstances of the case and in law, the Ld CIT (A) erred in upholding the order passed by the Addl. CIT under section 271D of the Act on the basis that the appellant had violated the provisions of section 269SS of the Act and also argued that there was no reasonable cause for such alleged contravention.
2. On the facts and in the circumstances of the case and in law, the CIT (A) erred in upholding the penalty imposed under section 271D of the Act without appreciating the fact that the appellant had not accepted any loan or deposit of money more so in contravention of the provisions of section 269SS of the Act.
On the facts and in the circumstances of the case and in law, the CIT (A) erred in upholding the penalty imposed under section 271D of the Act without appreciating the fact that the transactions of assigning or transferring rights/receivables and liabilities amongst the group companies by passing journal entries does not tantamount to taking or accepting of loan or deposit of money and it is not in contravention of section 269SS of the Act. Hence, the impugned penalty levied under section 271D of the Act ought to be deleted. The Ld CIT (A) ought to have held that the making of journal entries in the books of the respective parties for the impugned purpose is also one of the recognized modes of assigning or transferring the rights/receivables/liabilities in relation to genuine business transactions and it does not result in a contravention of section 269SS of the Act and in any event, the adjustment of accounts by passing such entries would tantamount to sufficient cause as contemplated by section 273B of the Act.
(3.) ON the facts and in the circumstances of the case and in law, the Ld CIT (A) erred in upholding the penalty levied under section 271D of the Act without appreciating the fact that the transactions entered into amongst the group companies were genuine, bona fide and entered into on account of commercial exigency and were neither intended nor resulted in any tax evasion or concealment of income. The curbing of which was the avowed object behind the introduction of section 269SS of the Act.;
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