Into the CIT compared to. Roentgen.Yards. Chidambaram Pillai 106 ITR 292(SC),this has been kept you to definitely relationship is only a collaborative from independent people rather than a legal member of by itself. Hence, around cannot be a binding agreement regarding provider during the rigid legislation anywhere between a strong and another of their lovers.

The fresh conditions regarding Point 269SS of Operate doesn’t lured only for import out of total that loan account from inside the the type of guide admission

Hence, relying on the above mentioned idea, some process of law enjoys kept when from a collaboration company, there’s no separate identity regarding partner and you may corporation and you can, thus, in which someone took mortgage during the cash regarding enterprise, there clearly was zero admission from part 269SS in order to invoke penal terms out of area 271D. CIT vs V. Sivaku] thirty-two taxmann 62 (Madras), CIT vsLokhpat Film Exchange (Cinema) 304 ITR 172 (Raj.), Shrepak Enterprises compared to DCIT 64 ITD 3 hundred (Ahd.- Trib.)

Financial support share inside the bucks regarding someone in the union firm doesn’t focus specifications from Area 269SS even when the count was returned on the low-approval from Bodies to possess composition regarding partnership corporation

A plain reading of your Point 269SS of Act suggests which pertains to a transactionwhere in initial deposit or financing are approved by the an assessee, otherwise than by the a free account payeecheque otherwise a merchant account payee draft. The fresh ambit of your own Area is obviously simply for deals associated with welcome of cash which is perhaps not meant to affect cases where a loans otherwise a responsibility comes up due to publication entries. The actual only real object with the part will be to avoid purchases when you look at the currency.

This really is in addition to clearly direct off clause (iii) of your own reasons in order to Point 269SS of one’s Operate which defines loan or put to help you indicate “financing otherwise put of cash”. The new liability registered from the instructions from account as a result of diary entries,we.age. crediting the brand new membership off a celebration to help you whom funds is actually payable otherwise debiting the new membership of aparty out of exactly who funds was receivable on the instructions out of levels, is really away from ambit of one’s supply out of Point 269SS of https://perfectloans24.com/payday-loans-ne/atkinson/ one’s Work, as passageway such as for example records do notinvolve allowed of every financing or put of cash Administrator cash-taxation, (Central) IV vsAdinath Developers (P.) Ltd 102 taxmann 57 (SC) HC kept one to bill of any progress otherwise loan by way regarding record records is within breach regarding point 269SS. CIT Vs. All over the world Township Tactics Ltd., 367 ITR 433 (Delhi). Opposite see could have been pulled by Highest Judge out-of Bombay in CIT against Achievement Around the world Financing (I) Ltd. 345 ITR 270 (Bombay) in which held you to cost of loan/put from the only debiting account owing to journal records contravenes arrangements out of Point 269T.

• CIT versus Noida Toll Link Co. Ltd. (2003) 262 ITR 260 (Del) Where in actuality the purchase is by an account payee cheque, no payment toward membership is established into the bucks because of the assessee otherwise to your their part, zero financing might have been recognized from the assessee in the dollars, plus the commission regarding Rs. cuatro.85 crore is made thanks to IL&FS, and this keeps more than 29% of your own paid-up resource of one’s assessee by record entries by crediting the new account regarding IL&FS, new Hon’ble Delhi High Legal observed you to definitely provisions of section 269SS aren’t attracted. Neither new assessee nor IL&FS had generated one payment in the bucks.
• DCIT versus Forging Ltd. twenty-five taxmann 156 (Delhi-ITAT) Facts: The fresh new attention getting homes are paid back so you’re able to growers thanks to a real estate agent while the agent’s membership try paid courtesy record entries. The quantity is paid in cash by the representative into the growers. Stored, The expression financing otherwise deposits become laid out in order to mean loan or deposit of cash. This new assessee has not yet approved one put away from compliment of money in cash. This has credited the fresh new membership regarding ‘D‘ thanks to journal records in respect of purchase attention repaid towards its behalf because of the ‘D‘ due to ‘J‘. Thus the latest area isn’t relevant.