Sippy Dubey vs. JCIT

Parties Involved

Facts Summary

The assessee, Sippy Dubey, derives income from share trading and filed her return of income under section 139(1) of the Income Tax Act, 1961, declaring income of Rs.4,81,420/-. The case was selected for scrutiny under CASS for examination of security transactions. Upon examination, it was found that the assessee earned speculation income of Rs.1,76,436.76/-, STCG of Rs.3,08,119.42/- and LTCG of Rs.7,245.90/- from share trading. The assessee filed her return of income for AY 2015-16 showing business income of Rs.4,08,870/- against the gross turnover/gross receipts of Rs.8,49,371/-. However, on perusal of bank accounts, it was noted that there were cash deposits of Rs.60,50,000/-. The assessee was requested to explain the source of these cash deposits, to which she responded that Rs.10,00,000/- was received as an unsecured loan from Mr. Avinash Choudhary and Rs.50,50,000/- was credited through cash and cheques. Upon further examination, it was noted that the assessee received Rs.20,50,000/- in cash as an unsecured loan from her husband. The Assessing Officer initiated penalty proceedings under section 271D of the Act, and the penalty was confirmed by the Commissioner of Income Tax (Appeal). The assessee appealed to the Tribunal, which dismissed the appeal.…

Legal Issues

• 1. Whether the learned Commissioner of Income Tax (Appeal) erred in confirming the penalty of Rs.20,50,000/- without appreciating the intent behind the introduction of the penalty under Section 271D.
• 2. Whether the learned Commissioner of Income Tax (Appeal) erred in confirming the penalty of Rs.20,50,000/- without appreciating that the transaction under Section 269SS in respect of which the penalty has been imposed was done between husband and wife which generally constitute a single family for finance purposes.
• 3. Whether the learned Commissioner of Income Tax (Appeal) erred in confirming penalty of Rs.20,50,000/- without appreciating that the transaction under Section 269SS in respect of which the penalty has been imposed was just a technical breach without there being any mala fide intention on the part of the appellant.
• 4. Whether the learned Commissioner of Income Tax (Appeal) erred in confirming penalty of Rs.20,50,000/- without appreciating that for the transaction under Section 269SS in respect of which the penalty has been imposed the appellant had a reasonable cause as required under Section 273B.

Judgment Outcome

Decided in favour of Assessee.

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