Tribunal held that the assessment was completed after verification of the books of account and had made no adverse comment with regard to payment of loan through demand drafts. The assessee also furnished the demand draft number in the account copy. Therefore, there was no reason to disbelieve the submission of the assessee that the repayment was made through demand drafts as furnished in the account copies and there was no case for levy of penalty under section 271E with respect to the payments made to the depositors. Accordingly, the penalty was set aside.( AY.2013-14)
Sudha Agro Oil and Chemical Industries Ltd. v. Add. CIT (2020) 79 ITR 520 ( Vishakha) (Trib)
S. 271E : Penalty – Repayment of loan or deposit -Loans from directors – Reasonable cause – Repayment by demand draft – levy of penalty is not justified .