M/s. Kanungo Ferromet Pvt.Ltd. v. The Addl. Commissioner of Income-tax, Range 5(2), Mumbai
[Citation -2016-LL-1004-50]
| Citation | 2016-LL-1004-50 |
|---|---|
| Appellant Name | M/s. Kanungo Ferromet Pvt.Ltd. |
| Respondent Name | The Addl. Commissioner of Income-tax, Range 5(2), Mumbai. |
| Court | ITAT-Mumbai |
| Relevant Act | Income-tax |
| Date of Order | 04/10/2016 |
| Assessment Year | 2005-06 |
| Judgment | View Judgment |
| Keyword Tags | account payee cheque • advance payment |
| Bot Summary: | During the course of assessment proceedings, the Assessing Officer noticed that the assessee-company has passed a journal entry debiting the loan account of Shri Om Prakash Kanungo, Director of the company and credited the advance account of Shri R.Bhaskaran. The assessee before the Addl.CIT filed detailed reply stating that during assessment year 2004-2005, the assessee- company has advanced a sum of Rs.15 lakh to Shri R.Bhaskaran towards business deal. In support of which the ledger account copy of Shri R.Bhaskaran in the books of the assessee-company for assessment year 2004-2005 was filed. The assessee claimed that this advance payment was given for indented business deal by the assessee-company to Shri R.Bhaskaran amounting to Rs.15 lakh, which could not materialize and the said advance payment has been returned by him in assessment year 2005-2006 only through account payee cheque in the name of Director of the assessee-company Shri Om Prakash Kanungo instead of paying back it directly to the assessee-company. The assessee filed complete particulars of account payee cheque given to Shri Om Prakash Kanungo by Shri R.Bhaskaran, in assessment year 2005-2006 and the details were available before the A.O. This fact is not disputed by either 3 ITA No.995 Mum 2014. According to A.O. once this loan is received back by account payee cheque draft by Shri Om Prakash Kanungo from Shri R.Bhaskaran, on behalf of the company, but Shri Om Prakash Kanungo passed a journal entry in the books of assessee-company, the same is to be treated as repayment of cash loan and accordingly, the Addl.CIT levied penalty u s 271E of the Act for violation of the provisions of section 269T of the Act for repayment of cash loan. Shri R.Bhaskaran repaid this advance, but it was paid in the name of one of the Directors of the company Shri Om Prakash Kanungo through account payee cheque, who in turn returned this amount to the assessee-company through journal voucher entry. |