- (1.) THE subject matter of challenge in this appeal is a judgment and order dated 18th October, 2004 pertaining to assessment year 1999 -2000 by which the learned Tribunal allowed the appeal preferred by the revenue setting aside the order passed by C.I.T. (Appeals) deleting the penalty imposed upon the assessee. The facts and circumstances of the case briefly stated are as follows; "On 6th May, 1998, the assessee borrowed a sum of Rs. 1,90,000/ - in cash from his brother. It is not in dispute that the sum of Rs. 1,90,000/ - was withdrawn by the brother of the assessee from his own bank account. After the withdrawal was made, the sum was made over to the assessee and on the same day the assessee deposited the amount in his bank account. This is how cash loan of a sum of Rs. 1,90,000/ - was received by the assessee which is in contravention of section 269SS of the Income Tax Act. The assessee was penalised by an identical sum of Rs. 1,90,000/ - under section 271D."
(2.) IN an appeal preferred by the assessee, the C.I.T. (Appeals) was of the opinion that there was a reasonable cause which led the assessee to took the loan otherwise than by an account payee cheque and, therefore, the penalty should not have been levied. The C.I.T. (Appeals) has obviously taken assistance of section 273B, which provides that no penalty shall be impossible for any failure referred to in section 269SS, if the assessee proves that there was a reasonable cause for the said failure.
(3.) AGGRIEVED by the appellate order, the revenue preferred an appeal which was allowed by the Tribunal, which is under challenge. At the time of admission of the appeal the following questions were formulated; - "i) Whether the Tribunal without considering the facts of the present case and the totality of the circumstances under which the cash loan was obtained by the assessee was justified in law in confirming the penalty amounting to Rs. 1,90,000/ - imposed by the respondent No. 3 under Section 271D of the I.T. Act for violating the provision of Section 269 SS of the I.T. Act without even considering the object for which Section 269 SS of the I.T. Act was inserted by the Finance Act, 1984 and by interpreting Section 273B of the I.T. Act in a hypertechnical way as if the urgent requirement of money is the only criteria for applying the Section 273B of the I.T. Act for not imposing any penalty under Section 271D of the I.T. Act without even taking into consideration the genuineness of the loan transaction and the other genuine causes whereas Section 273B inter alia clearly says that no penalty shall be imposable if there is reasonable cause for accepting the cash loan and when all these aspects have been totally ignored by the Tribunal while deciding the present case? ii) Whether on the facts and in the circumstances of the case, the order of the Tribunal confirming the penalty amounting to Rs. 1,90,000/ - under Section 271D of the I.T. Act 1961 was perverse and not sustainable in law? " Mr. Biswas, learned advocate appearing for the appellant submitted that the well reasoned order passed by the C.I.T. (Appeals) was interfered with by the learned Tribunal for no justifiable cause.;