9911796707
TMI Blog2022 (9) TMI 764X X X X Extracts X X X X X X X X Extracts X X X X ..... he CIT(A) is justified in confirming the penalty imposed u/s 271D of the I.T.Act. 3. The brief facts of the case are as follows: The assessee is a NRI. During the relevant assessment year, the assessee had sold two immovable properties on 26.12.2016 and received part sale consideration in cash. The particulars of the transaction are detailed below:- Sl. No. Reg. No. with SRO Code Name of the buyer Total sale consideration Amount received in cash 1. BGR-1-05475 Smt. Angammal & Sri Dhanapal 25,61,000 10,00,000 2. BGR-1- 05474 Sri Kandaswamy M & Sri Ramachandra H.R. 22,37,000 2,37,000 Total 47,98,000 12,37,000 4. Information was received by the A.O. from JDIT (I&CI) with regard to the above receipt of cash ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble in India. The assessee has accepted a cash of Rs.10,00,000 from Smt.Aganmad and Shri Dhanpal from the first property transaction. Similarly, assessee has received a cash of Rs.2,37,000 from Shri Kandaswami and Shri H.R.Ramachandra from the second property transaction. The assessee ought to have received the entire consideration by banking transaction only. Any violation of the same is attracted u/s 269SS and for levy of penalty u/s 271D of the IT Act. To this extent the assessee has made a technical violation of the IT provisions. 8. The submission of the assessee explaining 'good and sufficient reason' for accepting cash consideration during property transaction are verified. It is seen that the assessee has entered into the transact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of section 273B of the Act, and also not appreciating the detailed explanations, clarification submitted by the Appellant in support of the genuine and bona fide transaction; 6. The Learned CIT(A) and AO have erred in law in not appreciating the fact that it was a case of distress sale; 7. The Learned CIT(A) and AO have erred in law and on facts in not appreciating that the transaction entered with respective buyers were genuine and bona fide; 8. The Learned AO has erred in raising demand vide issue of notice under section 156 of the Act; (Total tax effect: Rs.12,37,000/-) On the basis of above grounds and other grounds which may be urged at the time of hearing with the consent of the Honourable Tribunal, it is prayed that the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... old were held by the assessee from the year 1994. The assessee was finding it difficult to sell these properties since 50% of the interest in the subject properties were initially held by her estranged husband. Pursuant to the judgment of divorce dated 22.03.2006, the Oak Land Country Circuit Court Family Division in the state of Michigam, United States of America has annulled the marriage and upon arbitration, the subject properties were allotted to the assessee. Despite the above arrangement, many buyers were hesitant to buy subject properties directly from the assessee as the name of the husband was part of the documents purchasing them. The disposal of the property was also challenging due to the slump in the real estate market pursuant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asonable cause' as mandated u/s 273B of the I.T.Act on facts of the instant case. The Hon'ble Jharkhand High Court in the case of OMEC Engineers v. CIT reported in (2007) 294 ITR 599 (Jhar) had deleted the penalty by considering the urgency of the assessee to make payment, who had borrowed money in violation of provisions of section 269SS of the I.T.Act. The relevant finding of the Hon'ble High Court reads as follows:- "22. The words " reasonable cause" have not been defined under the Act but they could receive the same interpretation which is given to the expression " sufficient cause" . Therefore, in the context of the penalty provisions, the words " reasonable cause" would mean a cause which is beyond the control of the assessee. " Rea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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