BALAJI TIRUPATHI CONSTRUCTION,PATNA V. ITO WARD-2(1), PATNA

CO 9/PAT/2025

AI Insights

The case involves an appeal by the Revenue against the decision of the CIT(A), which had allowed the appeal of Balaji Tirupati Construction Pvt. Ltd., the respondent, on the grounds that the penalty under Section 271D of the Income Tax Act was not applicable as the cash receipts were from the sale of flats, which were part of stock in trade. The Revenue contended that the penalty was justified as the transactions occurred during the period of demonetization and involved substantial cash receipts. The Tribunal dismissed the Revenue's appeal due to the irrelevance of the grounds raised to the CIT(A)'s decision and also dismissed the assessee's cross objection due to procedural delays.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 847597 (ITAT-PATNA)
• Duration Of Justice: 8 month(s) 16 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 24-03-2026
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Patna
• Assessment Year: 2017-2018
• Appeal Filed On: 08-07-2025
• Other Referred Cases: Collector, Land Acquisition vs Mst. Katiji
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MANAB ADAK
• Assessee Lawyers: VIPIN KUMAR
• Keywords: Condonation of delay; Business income; Reasonable cause
• Section: 142(1)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “PATNA BENCH, PATNA (VIRTUAL HEARING AT KOLKATA) SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER SHRI SONJOY SARMA, JUDICIAL MEMBER ITA No. 04/PAT/2023 Assessment Year : 2017-18 ITO Ward 2(1), Patna, 3rd Floor, Lok Nayak Jai Prakash Bhawan, Patna (Bihar) Vs. Balaji Tirupati Construction Pvt. Ltd., House No. 46, Second Floor, North S.K. Puri, Boring Road, Patna, Bihar [PAN: AADCB2019A] APPELLANT RESPONDENT CO No. 09/PAT/2025 (Arising out of ITA No. 04/PAT/2023) Assessment Year : 2017-18 Balaji Tirupati Construction Pvt. Ltd., # 46, 2nd Floor, North S.K. Puri, Boring Road, Patna, Bihar [PAN: AADCB2019A] Vs. ITO Ward 2(1), Patna, 3rd Floor, Lok Nayak Jai Prakash Bhawan, Patna (Bihar) APPELLANT RESPONDENT Assessee by : Sh. Vipin Kumar, Adv. Revenue by : Sh. Manab Adak, JCIT Date of hearing : 19.03.2026 Date of Pronouncement : 24.03.2026 Printed from counselvise.com 2 ITA No. 4/PAT/2023 CO No. 09/PAT/2025 Balaji Tirupati Construction Pvt. Ltd. O R D E R PER LAXMI PRASAD SAHU, ACCOUNTANT MEMBER This is an appeal filed by the Revenue and cross objection filed by the assessee against the order passed u/s 250 of the Income Tax Act, 1961 (hereafter “the Act”) by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereafter “the Ld. CIT(A)] dated 22.09.2022, DIN & Order No. ITBA/NFAC/S/250/2022-23/1045837853(1). The grounds raised by the Revenue are as under: “(i) Due to Covid -19 Pandemic, the due date had been extended from 30th September, 2021 to 31 March,2022 vide Notification No.113/2021/F.No.370142/35/2020-TPL-Part 1 dated 17/09/2021. penalty order was passed on 05.01.2022 which is not barred by limitation. Had it been so, the system would not have allowed to pass the order on ITBA. Hence the learned CIT(A) has erred in quashing the very initiation and levy of penalty. (ii) Any other grounds that may be urged at the time of hearing.” 2. The grounds of cross objection raised by assessee are as under: “1. That present appeal has been filed on 12.01.2023 against order dated 22.09.2022 without any plausible reason for condonation of delay hence, present appeal is barred by limitation. 2. That penalty imposing authority while passing the order under Section 271D of Income Tax Act has specifically recorded in Para-4 of order dated 05.01.2022 that show cause notice dated 19.02.2019 has been issued to the assessee seeking its explanation as to why penalty under Section 271D of the Act shouldn't be imposed. Since department itself has record the date of issuance of show cause as 19.02.2019, therefore, same has been taken as date of initiation of proceeding as such proceeding should be completed within six months i.e. 18.08.2019. In view of above Notification No. 113/2021/F No. 370142/35/2020 TPL Part 1 dated 17.09.2021 will not help the appellant. However, same was not produced before the learned CIT Appeal. 3. That apart from above stated technical ground present appeal is also fit to be dismissed on law as well as on merit of the fact which has been allowed by the learned CIT Appeal and recorded in the order for academic purpose. 4. That Assessing Officer has not found any case of Tax evasion and source of income has also been duly verified in course of assessment. Printed from counselvise.com 3 ITA No. 4/PAT/2023 CO No. 09/PAT/2025 Balaji Tirupati Construction Pvt. Ltd. 5. That learned Tribunal has also allowed the ground of assessee that present case doesn't come in ambit of Section 269SS as money received was against sale of flat which were stock in trade. 6. That ground taken by the assessee which has been considered and allowed but appellant has not disputed specifically while filling the appeal. 7. That assessee has received the money only with intention to secure the purchaser but in the meantime Government of India has announced demonetization, therefore, money could not be returned and same has been deposited in the bank. 8. That in above facts and circumstances of the case present appeal is fit to be dismissed. 3. At the outset of hearing, we note that appeal filed by the Revenue is delay by 52 days. In this regard, the Revenue has filed petition dated 12.01.2023 which is placed on record stating the reason for delay in filing the appeal. On going through the petition, we noted that the Revenue had sufficient cause for not filing the appeal in due time and it has explained the reasons in the application. 4. On going through the above reasons/explanations, we noted that the Revenue had reasonable cause for not filing the appeal within the specified time. Therefore, relying of the judgment of Collector, Land Acquisition vs Mst. Katiji, (1987) 167 ITR 171 (SC), we condone the delay and the appeal is taking up for adjudication. 5. Briefly stated the facts of the case are that the assessee is derived income from the business income of real estate development, its filed return of income on 21.10.2017 showing total income of ₹ 2,03,690/-. subsequently, the case was selected for scrutiny and notice under Section 143(2) and 142(1) of the Act dated 10.08.2018 was issued. During the course of scrutiny proceedings, it was observed that the Printed from counselvise.com 4 ITA No. 4/PAT/2023 CO No. 09/PAT/2025 Balaji Tirupati Construction Pvt. Ltd. assessee has accepted the cash from the prospective buyers of ₹ 84,50,000/- and particularly during the period of demonetisation, the assessee had received cash of ₹ 72,00,000/- in the SBNs. Consequently, the penalty proceeding under Section 271D of the Act was initiated upon the assessee and penalty order was passed on 05.01.2022. Accordingly, show cause notice dated 19.02.2019 was issued to the assessee seeking its explanation as to why penalty under Section 271D of the Act should not be imposed in contraction of the provision of section 269SS of the Act and time granted to the assessee by 27.02.2020 and penalty order passed by the Assessing Officer on 05.01.2022 imposing the penalty against which the assessee filed before the Ld. CIT(A), the Ld. CIT(A) held that section 271D of the Act could not be levied in the case of the assessee company for the reason that cash receipt on account of sale of flats and the appeal of the assessee was allowed. 6. Aggrieved from the above order of the Ld. CIT(A), the Revenue filed appeal raising the above grounds noted (supra). 7. On going through the above grounds, the grounds raised by the Revenue are not co-related with the decision rendered by the Ld. CIT(A). From the above grounds of appeal, it is clear that the grounds raised by the revenue are not emanating from the order of Ld. CIT(A). The Ld. CIT(A) has allowed the appeal observing that the assessee has not violated the provision of section 269SS of the Act, therefore, the penalty under Section 271D of the Act will not apply on sale of flats which is clear from the order of para number 7.3.5 of the Ld. CIT(A) but the grounds raised by the Revenue are on limitation. Therefore, appeal of the Revenue is dismissed in limine and given liberty to take appropriate grounds before the ITAT if revenue wants to come in appeal. Therefore, appeal of the revenue is dismissed. Since, the assessee has fled Cross Objection on 08.07.2025 which is a after lapse of long period of appeal Printed from counselvise.com 5 ITA No. 4/PAT/2023 CO No. 09/PAT/2025 Balaji Tirupati Construction Pvt. Ltd. filed by the Revenue. Therefore, it cannot be said the cross objection filed by the assessee is a separate appeal without filing any condonation application for delay. Since, we have dismissed the appeal of the revenue in limine. Therefore, the CO will not survive and need not to give separate adjudication on the grounds raised by the assessee in its CO. The assessee is given also liberty to file cross objection in future if the revenue files appeal against the order passed by the Ld. CIT(A). 8. To sum up- Appeal filed by the Revenue is dismissed and Cross Objection filed by the assessee are also dismissed in above terms. Order pronounced on 24.03.2026 Sd/- Sd/- (Sonjoy Sarma) (Laxmi Prasad Sahu) Judicial Member Accountant Member Dated: 24.03.2026 AK, Sr. P.S. Copy of the order forwarded to: 1. Appellant 2. Respondent 3. Pr. CIT 4. CIT(A) 5. CIT(DR) //True copy// By order Assistant Registrar, Kolkata Benches Printed from counselvise.com "