9911796707
TMI Blog2024 (10) TMI 1088X X X X Extracts X X X X X X X X Extracts X X X X ..... d. The Assessing Officer also has accepted the transaction as genuine as per the Act. As decided in Shri R. Dhinagharan (HUF) [ 2024 (1) TMI 61 - ITAT CHENNAI] it is an admitted fact that all sale deeds were registered and cash payment was made at one go before the sub- registrar at the time of registration of sale deeds of plots. Hence, in our view, there is no violation of provisions of section 269SS of the Act -Appeal filed by the assessee is allowed. - Shri S. Rifaur Rahman, Accountant Member And Shri Vimal Kumar, Judicial Member For the Assessee : Shri K.K. Juneja, Advocate For the Revenue : Shri A.S. Rana, Sr. DR ORDER PER S. RIFAUR RAHMAN, AM : 1. This appeal is filed by the assessee against the order of ld. Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to Ld. CIT (A) ) dated 29.03.2023 for Assessment Year 2016-17. 2. Brief facts of the case are, assessee filed his return of income for Assessment Year 2016-17 on 14.03.2017 declaring total income of Rs. 4,11,020/- by ITO, Ward 15, Dehradun. During assessment proceedings, the Assessing Officer observed that assessee has sold the property prior and matched the cash de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 4.3.2019 in reply to notice dated before imposition of penalty. Wherein an appellant has most sufficient and reasonable cause which has not been appreciated by the authorities below. 8. That in facts and circumstances of the case, the appellant has sold the property within a month when the new provision was inserted in the Act and appellant advocate or appellant was unaware of the same. 9. That in facts and circumstances of the case, the appellant has not breach the section u/s 269SS for which it was introduced. 10. That in facts and circumstances of the case, the penalty has imposed of Rs. 24,50,000/- u/s 271D may please be deleted. 5. At the time of hearing, ld. AR for the assessee submitted that the assessee is an income tax assessee, in the normal course, he had been filing his income tax returns every year declaring his salary income. He submitted that in the year under appeal, the return of income was duly filed declaring income from salary, house property as well as long term capital gain on sale of house Rs. 27,00,000/- and after taking the deduction under chapter VIA Net Income was declared at Rs. 4,11,020/-. The said declared income has been assessed and accepted by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the section 269SS was introduced by parliament to curb the black money. As the transaction was genuine and not sham and there was utter ignorance of law with the assessee. He submitted that the AO JCIT wrongly initiated the penalty provisions only on the basis of technical and venial in nature. The fault with the assessee was technical and venial in nature. This proves the Innocence of the assessee in accepting the payment in cash. 7. He submitted that the aforesaid section was introduced by the legislation in order to curb cash transactions resultantly restricting black money circulation, two sections i.e. 269SS and 269T of the Income Tax Act. Both the said section deals with 1. Section 26955 of the Income Tax Act deals with the modes of taking/ accepting certain loans, deposits and specified sums: 2. Section 269T of the Income Tax Act deals with the modes of repayment of certain loans or deposits. In simple terms, according to both the sections, the person is restricted from taking/ accepting and the person is restricted from repaying the loans or deposits in cash above the specified limit. He submitted that the above transaction is neither a loan, deposit which was in the existe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order of the Assessing Officer and NFAC, the penalty order was passed by the ld. CIT(A) in violation of the principle of natural justice without granting to the assessee a fair, proper and meaningful opportunity to be heard not providing him with a draft order so that he may counter the objections of Ld. JCIT, NFAC. He submitted that the penalty order is arbitrary and bad in law. 11. He further submitted that penalty u/ s 271 D cannot be levied simply on the basis of mere contravention of the provisions of section 269S5 of the Act. The legislature has provided sufficient safeguard by enacting the provisions of section 273B of the Act. It provides in clear terms that penalty cannot be levied where the assessee is able to prove that there was reasonable cause for non-compliance of provisions specified in the section which includes S.271D. Thus, penalty cannot be levied on mere contravention of the provisions of law and therefore, the Jt.CIT must consider the facts circumstances of the case as we1l as the object behind the penal provisions before levying the penalty. He placed reliance on the CBDT Circular No- 19/2015 dated 27.11.2015 wherein it has been made clear that S. 269SS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty can be imposed on the basis of mere contravention of any law. In the present case, firstly, the assessee belongs small status as he is clerk in Uttarakhand State woman commission, and thus was unaware of any provisions of the Act what to speak of section 269SS as well as 271D. Further, he was not well educated since he is simply graduate and thus was totally dependent upon his consultant even for filing income tax return. 14. He further submitted that, Revenue Secretary says that Government wanted a stable and predictable tax regime, so very little tinkering was done in the Union Budget. There is a need to simplify direct tax laws as various carve outs or exemptions announced every year have made them complicated, Revenue Secretary Tarun Bajaj said. 15. Ld. AR further submitted that there was also no intention of evading tax leviable on the sale of land which is also apparent from the fact that the return of income filed by the assessee has been accepted by the AO himself. The object of the legislation behind the introduction of penalty provisions u/s 271D 271E was to curb the generation of black money and thus penalty is not to be proposed in each and every case for mere br ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has accepted Rs. 24,50,000/- in cash and not explained the reasonable cause. He supported the findings of the ld. CIT (A) that the amended provisions of section 269SS does include transactions in immovable property in order to curb the circulation of black money. The assessee s case was also not covered by any exception given in the Act. Therefore, he supported the findings of the lower authorities. 17. In the rejoinder, ld. AR of the assessee submitted that the provisions of section 269SS and 271D is application only in the cases of involvement of black money. In this case, there is no black money involved since the assessee has declared the sale consideration in the sale deed. In this regard, he relied on the decision of ITAT, Chennai in the case of ITO vs. Shri R. Dhinagharan (HUF) in ITA No.3329/Chny/2019 dated 29.12.2023. 18. Considered the rival submissions and material placed on record. We observed from the detailed submissions made by the assessee and material information available on record, we observed that assessee has sold a property and received Rs. 24,50,000/- in the form of cash after due registration of the property. The same was deposited in his bank accou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... takes place. The Budget Speech of the Hon'ble Finance Minister while placing the Finance Bill, 2015 highlighting the intention of the amendment relevant for decision making in the present appeal is captured below: 3. A. Measures to curb black money 3.1 With a view to curbing the generation of black money in real estate, it is proposed to amend the provisions of section 269SS and 269T of the Income-tax Act so as to prohibit acceptance or re-payment of advance in cash of Rs. 20,000 or more for any transaction in immovable property. It is also proposed to provide a penalty of an equal amount in case of contravention of such provisions. The Memorandum forming part of Finance Bill, 201.5 highlighting the intention of the amendment is captured below: B. MEASURES TO CURB BLACK MONEY Mode of taking or accepting certain loans, deposits and specified sums and mode of repayment of loans or deposits and specified advances The existing provisions contained in section 269SS of the Income-tax Act provide that no person shall take from any person any loan or deposit otherwise than by an account payee cheque or account payee bank draft or online transfer through a bank account, if the amount o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r through a bank account if the amount of such loan or deposit is twenty thousand rupees or more. It is proposed to substitute the said section so as to provide that no person shall take from any person, any loan or deposit or specified sum, otherwise than by an account payee cheque or account payee bank draft or online transfer through a bank account if the amount of such loan or deposit or specified sum is twenty thousand rupees or more. It is also proposed to define specified sum as any sum of money receivable, whether as advance or otherwise in relation to transfer of an immovable property whether or not the transfer materialises. These amendments will take effect from 1st June, 2015. 12.1 In the present case, the sale consideration was received in cash at the time of execution of multiple sale deeds from different persons for the sale of plots and accepted as genuine in the assessment order completed on 23.05.2018 and admittedly there was no advance received by the seller. The amended provisions of Section 269SS of the Act was applied by the A.O to the facts of the present case only to the sale consideration received as 'specified sum' and on such presumption the JCIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rupees or more. 54.4 Section 269T of the Income-tax Act has also been amended to provide that no person shall repay any loan or deposit made with it or any specified advance received by it, otherwise than by an account payee cheque or account payee bank draft or by electronic clearing system through a bank account, if the amount or aggregate amount of loans or deposits or specified advances is twenty thousand rupees or more. The specified advance shall mean any sum of money in the nature of an advance, by whatever name called, in relation to transfer of an immovable property whether or not the transfer takes place. 54.5 Consequential amendments in section 271D and section 271E, to provide penalty for failure to comply with the amended provisions of section 269SS and 269T, respectively, have also been made. 54.6 Applicability: These amendments have taken effect from 1st day of June, 2015. From the above provisions, Memorandum explaining the intention of amendment by Finance Bill, 2015 including the definition of 'sum specified' brought in the Explanation to Section 269SS of the Act, it is clear that the intention for brining this provision was to curb the generation of black ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
