uring the course of assessment proceedings it was found by AO that the assessee had made repayment of unsecured loan of Rs. 3,75,000/- to village welfare society in cash. The said fact was also certified by the Auditor at clause 24 (Annexure-VI) of the relevant Tax Audit Report (TAR). Such activities of the assessee lead to initiation of penalty u/s 271E of the Act for contravention of provision of section 269T. These violation was brought to the notice of the assessee vide letter dt. 22/03/2014 issued by the Assessing Officer. In response, the assessee’s authorized representative, Shri Indranil Banerjee appeared on 19.09.2014 and submitted a written submission. However, Assessing Officer rejected the contention of the assessee and imposed penalty of Rs. 3,75,000/- u/s 271E of the Act.. We note that assessee made repayment of loan in five equal installments of Rs. 75,000/- each by way of Bank Transfer through Axis Bank Account No. 236010100020563 belonging to the lender. It is a recognized mode of payment recommended by Finance Bill, 2014, hence we delete the penalty of Rs. 3,75,000/-.