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(ii) In assessment year 1993-94, involved in assessees appeals, being ITA Nos. 434/Apr/2000 and 433/Jdpr/2000 and revenues appeals being ITA No. 499/Ju/2000 and 500/Ju/2000, the assessing officer Joint Commissioner held that instances mentioned in Annexure A and Annexure B of the penalty orders to be in the nature of deposits, violative of section 269SS and liable for penalty under section 271D; and similarly, when amounts were given from those accounts, in cash the repayments were also held to be violative of provisions of section 269T and liable for penalty under section 271E. The learned Commissioner (Appeals) cancelled the penalties in regard to instances of Annexure B known as balancing of accounts under both the provisions of sections 271D and 271E holding that they neither fell in the category of deposit under sections 269SS and 269T, nor was the penalty justified due to reasonable/sufficient cause envisaged under section 273B. However, the learned Commissioner (Appeals) held some instances of cash credits as per Annexure A totalling to Rs. 1,89,000 pertaining to three persons, namely, Shri Prem Prakash, Shri Gangaram, and Shri Shivraj to be in the nature of deposit and violative of section 269SS and in turn withdrawals therefrom in cash violative of section 269T, and so he sustained penalties for these receipts under section 271D and for repayments therefrom under section 271E, not accepting the assessees plea of reasonable cause, in respect thereof.

7. It has been contended on behalf of the assessee that the assessing officer, while framing assessment under section 143(3), initiated the penalty proceedings under section 271D and 271E specifically mentioning the same in the assessment orders that the penalty proceedings have been initiated. This is contained in paras. (ii) and (iii) in the assessment order for assessment year 1993-94, It has also been contended that the fact of initiation of penalty proceedings has also been recorded in para 2 on p. 1 of the penalty order under section 271D for assessment year 1993-94 wherein the Joint Commissioner observed that while passing the assessment order under section 143(3), the assessing officer has duly taken note of this and duly discussed the violation of provisions of section 269SS and initiated penalty proceedings under section 271D along with assessment order forming part of assessment proceedings; and that the Assistant Commissioner issued penalty notice under section 271D vide letter dated 15-3-1996, served on 16-3-1996. A copy of notice is placed on p. 2 of PB for assessment year 1993-94. It has been contended by the learned authorised representative of assessee that the penalty proceedings having been initiated on 15-3-1996, by Issuing specific notice for the purpose, as provided in law by assessing officer, the period of six months from the end of the month in which the penalty notice was issued for initiation of penalty proceedings expired on 30-9-1996. It has also been the contention of the authorised representative of assessee that these penalty proceedings are independent of the assessment proceedings and are accordingly covered by section 275(1)(c). It has also been contended that the initiation of penalty proceedings for all the assessment years involved in appeals under consideration is identical and identical findings were given by assessing officer and Joint Commissioner in respective orders in all the cases. It has also been contended that the gist of assessees contentions has been reproduced by Joint Commissioner in para 4 on pgs. 2 and 3 of the penalty order under section 271D for assessment year 1993-94 wherein the issuance of show-cause notice by Joint Commissioner on 15-3-1996, 12-9-1996,and 20-12-1996, for assessment years 1993-94, 1994-95 and 1995-96 has been mentioned it has been contended that in view of the aforesaid facts, the order of penalty should have been passed within six months from the end of the month wherein assessment was completed. It has also been contended that the provisions of section 275(1)(a) have no application to the facts of the instant cases for the reasons that the penalties under sections 271D and 271E have no dependence on or relevance with the computation of income being done in the assessment and so the decision of the appeals against assessment orders would not have any bearing on the concerned limitation. It has been contended that the Joint Commissioner rejected the assessees contention observing that the provisions of section 275(1)(c) are residuary in nature which can be said applicable only in a case where relevant assessment order is not subject of appeal which is not the case of the appellant. He has contended that the learned Commissioner (Appeals) also held that the nature of penalties and their dependence on or relevance with the issue involved in the relevant order is not relevant aspect and what is required under this clause is that relevant order should be subject-matter of appeal/irrespective of issues involved therein. He has contended that the learned Commissioner (Appeals) accordingly upheld the decision of Joint Commissioner that penalties imposed were within limitation. The learned authorised representative of assessee has contended that his contentions in respect of the issue of limitation are the same as raised by him before the authorities below. He has relied on the following decisions

9. He has contended that the impugned orders of imposition of penalty were barred by limitation and deserve to be cancelled.

10. As against this, the learned Departmental Representative or revenue has contended that Chapter XXI containing sections 270 to 275 deals with penalty. He has contended that learned authorised representative contention that section 275(1)(c) is relevant is not correct. He has contended that the Departments plea is that the provision of section 275(1)(a) is relevant. He has contended that the assessed income includes various additions including cash credits and if cash credit is treated as genuine and addition under section 68 is not tenable, then penalty under section 271D is leviable because there is violation of section 269SS if cash credit is held to be income of assessee under section 68 then section 269SS will not operate and in turn, no penalty leviable under section 271D. He has contended that because assessment was subject-matter of appeal before the Tribunal so the time-limit for levy of penalty is governed by section 275(1)(a), i.e., within six months from the date of receipt of Tribunals appellate order by CIT. He has contended that in these cases the Tribunals appellate orders were received by CIT on 17-9-1999, and so according to section 275(1)(a) the period of limitation for imposing penalty was upto 31-3-2000, and the penalty has been levied on 29-3-2000, and so the levy of penalty is within limitation. He has contended that the provision of section 275(1)(c) does not speak of any appellate proceeding., so this provision of section 275(1)(c) is not applicable here. He has contended that in Income Tax Act, there is no time-limit for initiation of penalty under section 271D/271E but sub-section (2) of section 271D and of section 271E provide jurisdiction to Joint Commissioner for levy of penalty. He has contended that after receipt of Tribunals order, the assessing officer referred the matter to Joint Commissioner for levy of penalty; and the Joint Commissioner then issued notice to assessee on 21-1-2000, and then he levied penalty on 29-3-2000. He has contended that the levy of penalty by Joint Commissioner is also within six months from issue of notice (initiation of penalty proceedings) by Joint Commissioner. He has contended that those penalty proceedings which have no relevance with assessment proceeding alone are needed to be completed within six months from initiation as per time-limit given in section 275(1)(c) because in those cases the appeal against assessment have no effect on penalty proceedings. He has contended that the other category of penalty proceedings which have relevance with assessment proceedings, as quantum of such penalties is determinable only on the final outcome of assessment are governed by section 275(1)(a). He has contended that the citation referred to by the learned authorised representative of assessee are distinguishable on facts and do not apply in the matter.

15. As regards the factum of initiation of these penalty proceedings, it is revealed from record that the assessing officer while completing assessment, took cognizance of the default under sections 269SS and 269T, and in turn, of penalties under sections 271D and 271E, and issued notices for the said penalties. The discussion/finding is contained specifically in paras. 16 and 17 on p. 19 and paras 19(ii) and 19(iii) of assessment order for assessment year 1993-94. Similar is the position in assessment year 1994-95 and 1995-96 as well. This discussion/finding of assessing officer regarding taking cognizance of the default under sections 271D and 271E and issuance of notices for the said penalties has also been specifically mentioned in the penalty orders. The above fact-situation regarding the assessing officers taking note of the default, initiation of penalty proceedings, and issuance of notice, and the mentioning of this factum of assessing officers said action in penalty order may be tabulated as under :