- (1.) Heard learned counsel for the appellant and Sri Gaurav Mahajan, learned counsel for the respondents.
(2.) This appeal has been filed by the assessee against the order of the Income Tax Appellate Tribunal, Delhi Bench 'H' dated 4.8.2006 passed in ITA No. 131 & 133 (Del)/2005 for the assessment year 1999-2000, on the following question of law:- "(a) Whether in view of the division bench judgment of the Hon'ble Rajasthan High Court in the case of C.I.T. vs. M/s Ajanta Dyeing and Printing Mills , the Tribunal was legally justified in disallowing the adjustment of Rs. 40,000/- in the amount of penalty imposed."
(3.) Briefly, it is undisputed fact that the appellant had taken cash loan for its business purpose on five different dates being 2.5.1998, 28.5.1998, 2.6.1998, 7.11.1998 and 30.1.1999 for Rs. 50,000/-, Rs. 1,00,000/-, Rs. 70,000/-, Rs. 50,000/- and Rs. 2,00,000/- respectively. All the loans having been taken in cash, the Assessing Officer invoking the provision of Section 271-D read with Section 269 SS of the Income Tax Act (hereinafter referred to as the Act) and imposed 100% penalty on the assessee for having taken those cash loans, in excess of statutory limit of Rs. 20,000/-.;