MEHBOOB ALAM,DEHRADUN V. JCIT, RANGE (1)(1), DEHRADUN

ITA 38/DDN/2023

AI Insights

The case revolves around the penalty imposed on Mehboob Alam for accepting cash in a property transaction, which was deemed a contravention of section 269SS of the Income Tax Act, 1961. The Assessing Officer initiated penalty proceedings under section 271D after observing that the assessee received a substantial amount in cash during the sale of a property. The Commissioner of Income-tax (Appeals) upheld the penalty, leading to the appeal before the Income Tax Appellate Tribunal. The Tribunal, after considering the submissions and the legal provisions, concluded that the penalty was not applicable as the transaction was genuine and the cash received was declared in the income tax return.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 474670 (ITAT-DEHRADUN)
• Duration Of Justice: 1 year(s) 4 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 10-09-2024
• Assessment Year: 2016-2017
• Appeal Filed On: 29-05-2023
• Other Referred Cases: Motilal Padampat Sugar Mills Ltd. vs. State of Uttar Pradesh, Hindustan Steels Ltd. vs. State of Orissa, Pratibha Bisht vs. ITO, ADI vs. Kumari A.B. Shanthi, Narendra Kumar vs. JCIT, Nymisha Kundum vs. ITO, CIT vs. Saini Medical Store, Omec Engineers vs. CIT, CIT vs. Smt. Dimple Yadav, CIT vs. Balaji Traders, ITO vs. Prabhu Lal Sahu, K.P. Vergese vs. ITO, Choudhary Co. Bhujiawala, Sudershan Auto & General Finance vs. CIT
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A. S. RANA
• Assessee Lawyers: K. K. JUNEJA
• Keywords: Opportunity of being heard; Reasonable cause; Salary income; Bonafide belief; Capital receipt; Ignorance of law; Principle of natural justice
• Section: 143(3); 143(2); 131; 54B; 271D; 273B; 271E

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DEHRADUN BENCH “SMC”, DEHRADUN BEFORE SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI VIMAL KUMAR, JUDICIALMEMBER ITA No.38/DDN/2023 (ASSESSMENT YEAR: 2016-17) Mehboob Alam, vs. JCIT, Range (1)(1), 32 – B, Shree Ram Puram, Dehradun. Kanwali Road, Dehradun – 248 001 (Uttarakhand). (PAN: AEJPA1391R) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri K.K. Juneja, Advocate REVENUE BY : Shri A.S. Rana, Sr. DR Date of Hearing : 10.09.2024 Date of Order : 18.10.2024 O R D E R 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 2 ITA No.38/DDN/2023 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 deposited in the bank account with SBI, Kanwali Road, Dehradun. On a query, assessee has submitted that assessee has received Rs.24,50,000/- on the date of registration and in support of the same, assessee has submitted a sale deed wherein above said transaction was already recorded in the abovesaid sale deed. Assessing Officer accepted the above transaction in the regular assessment, however observed that assessee has received the abovesaid sale consideration in cash. Accordingly, he initiated proceedings under section 271D of the Income-tax Act, 1961 (for short ‘the Act’) and in penalty proceedings, after considering the submissions of the assessee, levied the penalty of Rs.24,50,000/- u/s 271D as it contravenes the provisions of section 269SS of the Act (amended provisions w.e.f. 01.06.2016). 3. Aggrieved with the above order, assessee preferred an appeal before the ld. CIT (A) and ld. CIT (A) sustained the penalty after considering the submissions of the assessee. 4. Aggrieved, assessee is in appeal before us raising following grounds of appeal :- 3 ITA No.38/DDN/2023 “1. That in facts and circumstances of the case, the penalty order passed by the JCIT, Range-1(1), Dehra dun vide order dated 28.032019 in barred by limitation, henceforth requested to please delete the penalty as imposed by the JCIT. 2. That in facts and circumstances of the case, the appellant is an employee, as lower division clerk in Uttarakhand State Women Commission, Dehradun and he is unaware of the complicated provisions of the Income Tax Act and was depended upon his advocate advice. 3. That in facts and circumstances of the case, the appellant counsel failed to appear before the JCIT on the wrong conduct of the advocate the appellant should not penalized. 4. That in facts and circumstances of the case, the imposition of penalty is uncalled for and unwarranted. 5. That in facts and circumstances of the case, the bonafide of the transactions has not been disputed at any stage of proceedings, so the imposition of penalty is invalid. 6. That in facts and circumstances of the case, that the appellant has himself offered the capital gain arising out of sale of transaction and the return income has been accepted by the Faceless AO simply for the reasons that the transaction has been carried on in cash. 7. That in facts and circumstances of the case, that the authorities below have ignored the submission fired 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. 4 ITA No.38/DDN/2023 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 the AO. He submitted that copy of computation of income is enclosed herewith at page 24-26 of the paper book. He submitted that during the year under assessment, the assessee who is an individual received cash amount of Rs.27, 00,000/- (Rs.2,50,000/- as advance in April 2015) and balance before of Registered Sale Deed executed and submitted before the Competed Authority in the Court of law on 10th June 2015 in favour of buyer Shri Tej Veer Singh son of Shri Mohan Singh resident of 6/2 Kanwali Road Shivaji Marg Dehradun holding PAN no. BCCPS3263C and the copy of the Sale Deed is enclosed at Page no. 27-41 of the paper book. He further submitted that the income tax return for the year under consideration was duly filed and all relevant details of income and sales of 5 ITA No.38/DDN/2023 property relating to the year under consideration were declared in the return of income and before the lower authorities, copy of Sale deed was also filed. He further submitted that the AO in the course of assessment proceedings initiated u/s 143(2) of the Act. The assessment for the year under consideration was also made by the AO u/s 143(3) accepting the income declared by the assessee vide order dated 26.12.2018 in which entire sales consideration of sale of land of Rs.27,00,000/- was shown as capital receipts, under the head long term capital gain and out of sale proceeds, an amount was deposited in the bank account. He submitted that it is also worth to note that the AO recorded the statement u/s. 131 of the Income tax Act of the buyer Shri Tej Veer Singh on 26.12.2018 as admitted at para 4.4 of the CIT(A) order page 4 who also admitted the above said facts of the case at the back of the assessee and without providing an opportunity to the assessee. The AO after going through all the papers & documents accepted the long term capital as well as pleased to assess the income as declared and had accepted the return of income of the assessee. 6. Ld. AR for the assessee further submitted that the assessee had no intention to avoid taxes and the sales transaction was proved genuine during the course of assessment proceedings u/s 143 (3) of the Act and sales were considered as income of the assessee and though assessee claimed deduction 6 ITA No.38/DDN/2023 u/s 54B of the Act and it was accepted by AO after due verification of the records and no concealment was proved and no generation of black money was detected for which 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 existence since long whereas, the word \"Specified sum\" was 7 ITA No.38/DDN/2023 introduced for the first time on 1.6.2015. The assessee was not aware of the fact in such a short time of 9 days, as the sale deed was done of 10.6.2015. 8. Ld. AR further submitted that it was bonafide belief of the assessee that he is selling his land and buyer wanted to give the money in cash the relation between two were of seller & buyer can accept the payment in cash for sale of his house property. He accepted the payment in cash and as he was not aware about the newly inserted amendment with section 269SS of the Act. It was belief of the assessee that he shall not be avoiding taxes if situation arises. He was having bank account with him but he accepted the payment in cash under a bonafide belief that he is not making or thinking to avoid taxes and he felt no difference in cash as well as bank. He accepted the payment in cash as buyer wanted to make the part payment in cash. Absolutely he was not known to the law. it was bonafide belief of the assessee that cash shall be consumed in purchasing land to build a house, for the welfare of the family as usually sale purchase of lands were made in cash at that time. Whether payment was .in cash or though banking channel registry was not denied by the registrar. Even Registrar was not known to the law when he made Registry of the assessee. 9. As regards sale deed, it is not doubted by the revenue, he submitted that the revenue has neither challenged the registration of the sale deed and nor has 8 ITA No.38/DDN/2023 challenged the cash consideration received by the assessee from the buyer at the time of registration. The entire sale consideration was voluntary declared in his return of income by the assessee, the same has been duly accepted by AO as income of the assessee and assessee claimed deduction u/s 54B of the Act. 10. Ld. AR submitted that no one told the assessee not to receive the payment in cash and also about the changes in law. Not buyer, not tax advisor, not registrar, not document writer who typed the registry and he did many registration of the land / property on daily basis and monthly basis. Law was nascent to the public at large particularly for the people those who were from village back ground. Earlier to this sale there are so many instances where cash was taken and given for sale and purchase of all the properties. Violation of principal of natural justice in 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. 9 ITA No.38/DDN/2023 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 was amended in order to curb generation of black money by way of dealings in cash in immoveable transactions. Thus, penalty cannot be levied where there is no indication regarding use of black money. He further submitted that at this stage, it would be appropriate to refer certain important judgments delivered by the apex court as well as high courts. He submitted that the first important decision would be the decision of Hon'ble Supreme court in the case of Motilal Padampat Sugar Mills Ltd. vs. State of Uttar Pradesh (1979) 210 SC wherein it has been observed as follows:- \"There is no presumption that every person knows the law. It is often said that everyone is presumed to know the law, but that is not a correct statement; there is no such maxim known to the law. It is therefore not possible to presume, in the absence of any material placed before the Court, that the appellant had full knowledge of the law.\" 10 ITA No.38/DDN/2023 12. Ld. AR for the assessee submitted that similar view has been taken by the Hon'ble apex court in the case of Hindustan Steels Ltd. vs. State of Orissa 83 ITR 26 SC by holding that penalty cannot be levied for mere failure to carry out a legal obligation. Penalty provisions, being quasi criminal proceedings, cannot be invoked unless the party acted deliberately in defiance of law or acted in conscious disregard of its obligation. Hence, penalty cannot be levied on mere breach of technical or venial breach of the provisions of law or where breach flows from a bona fide belief. He submitted that this shows that levy of penalty is not automatic i.e. on mere contravention of the provisions of law. However, the legislature has also taken care of this aspect by introducing the provisions of section 273B in the Act which provides that no penalty shall be imposed where the assessee is able to prove that there was reasonable cause for such failure. Thus, the combined reading of both the above provisions along with the above said decisions of the Hon’ble Apex Court shows that penalty u/s 271D is not automatic. Thus, the object behind such legislation is to be taken in consideration in such cases. Since, in the present case, the income tax return filed by the assessee has been accepted by the AO himself u/ s 143(3), penalty u/ s 271 D should not have been imposed on mere technical ground. 11 ITA No.38/DDN/2023 13. Ld. AR submitted that in view of the above legal position, no penalty 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 breach of the provisions of sections 271D & 271E of the Act as held by the courts mentioned earlier. He submitted that various circumstances have been taken 12 ITA No.38/DDN/2023 into consideration by the Courts & Tribunal for considering the scope of reasonable cause. He submitted that the decisions of the Hon’ble Apex Court, mentioned earlier, clearly hold that that levy of penalty u/ s 271D is not automatic simply on the basis that the assessee had accepted the sale consideration partly in cash and partly by cheques. He submitted that Hon’ble Apex Court has clearly held that no penalty u/s 271D or 271E should be imposed merely because that an assessee had accepted or paid cash in contravention of the provisions of sections 269SS or 269T of the Act unless there is an attempt on the part of the assessee to evade the tax due. The fact that the income tax return filed by the assessee had been accepted by the AO u/s 143(3) itself shows that there was no attempt on the part of the appellant to evade the tax due from him. Ld. AR for the assessee further relied on the following case laws :- (i) ITAT, Delhi in the case of Pratibha Bisht vs. ITO ITA No.2318/Del/2023 order dated November 16, 2023; (ii) Hon’ble Supreme court in ADI vs. Kumari A.B. Shanthi 255 ITR 258 (SC); (iii) ITAT, Ahmedabad in Narendra Kumar vs. JCIT in ITA No.195/Ahd./2022 order dated May 17, 2023; (iv) ITAT, Visakhapatnam in Nymisha Kundum vs. ITO in ITA No.210/Viz/2022 order dated May 29, 2024; (v) Hon’ble Punjab & Haryana High Court in CIT vs. Saini Medical Store 276 ITR 79 (PH); (vi) Omec Engineers vs. CIT 294 ITR 599 (Jharkhand); 13 ITA No.38/DDN/2023 (vii) CIT vs. Smt. Dimple Yadav 379 ITR 177 (All.); (viii) CIT vs. Balaji Traders (2008) 303 ITR 312 (Madras); (ix) ITO vs. Prabhu Lal Sahu (2006) 99 TTJ (Jd.); (x) Hon’ble Supreme Court in K.P. Vergese vs. ITO 131 ITR 597; (xi) Choudhary Co. Bhujiawala 89 TTJ 357 (Raj.); and (xii) ITAT, Delhi in Sudershan Auto & General Finance vs. CIT in ITA No.3368/Del/1996 order dated 9th October, 1996. 16. On the other hand, ld. DR for the Revenue submitted that the assessee has received sale consideration in the form of cash and the same was deposited in the bank account. He submitted that as per the new amended section 269SS w.e.f 01.06.2015, the assessee has not proved the reasonable cause in this case. In this regard, he relied on the findings of the ld. CIT (A) at page 6 of the order and submitted that 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 14 ITA No.38/DDN/2023 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 account and further utilised to buy another property. The Assessing Officer in regular assessment proceeding accepted the above transaction and completed the assessment without making any addition. Since assessee has accepted cash of Rs.24,50,000/- in the form of cash, Assessing Officer initiated the penalty proceedings u/s 271D for the reason that assessee has violated the provisions of section 269SS of the Act. Before us, the assessee has brought to our notice sale agreement wherein the abovesaid amount was clearly mentioned as settlement amount at the time of registration, speech of Finance Minister for amending the provisions of section 269SS wherein certain provisions were modified to curb the black money circulation in real estate transaction and relevant CBDT circulars. Further, it was submitted that assessee has already demonstrated the genuineness of the transaction 15 ITA No.38/DDN/2023 and reasonable cause u/s 273B, why penalty proceedings cannot be initiated u/s 271D. After considering the detailed submissions, we are of the view that the assessee has received cash after duly transferring the property after registration and money involved in this transaction is duly recorded in the sale deed. The Assessing Officer also has accepted the transaction as genuine as per the Act. In the similar transactions, we observed that ITAT, Chennai in the case of Shri R. Dhinagharan (HUF) (supra) considered the similar facts on record and held as under :- “12. We have heard the rival contentions, and gone through the facts and circumstances of the case. We find that the Revenue has challenged the correctness of the decision rendered by the CIT(A) vide order dated 30.09.2019 in deleting the penalty levied u/s 271D of the Act vide penalty order dated 12.06.2019. The CIT(A) had deleted the penalty on two counts namely on the non-applicability of the provisions of Section 269SS of the Act to the facts of the present case and on the ground of reasonable cause within the scope of Section 273B of the Act. We noted that the provisions of Section 269SS of the Act was amended w.e.f. 01.06.2015 to include the 'specified sum' within its ambit and the said term was defined in Explanation to the said Section which is reproduced as under: \"specified sum\" means any sum of money receivable, whether as advance or otherwise, in relation to transfer of an immovable property, whether or not the transfer 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. 16 ITA No.38/DDN/2023 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 of such loan or deposit is twenty thousand rupees or more. However, certain exceptions have been provided in the section. Similarly, the existing provisions contained in section 269T of the Income-tax Act provide that any loan or deposit shall not be repaid, otherwise than by an account payee cheque or account payee bank draft or online transfer through a bank account, by the persons specified in the section if the amount of loan or deposit is twenty thousand rupees or more. In order to curb generation of black money by way of dealings in cash in immovable property transactions it is proposed to amend section 269SS, of the Income-tax Act so as to provide that no person shall accept from any person any loan or deposit or any sum of money, whether as advance or otherwise, in relation to transfer of an immovable property otherwise than by an account payee cheque or account payee bank draft or by electronic clearing system through a bank account, if the amount of such loan or deposit or such specified sum is twenty thousand rupees or more. It is also proposed to amend section 269T of the Income-tax Act so as 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. It is further proposed to make 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. These amendments will take effect from 1st day of June, 2015. The Notes on Clauses forming part of Finance Bill, 2015 highlighting the intention of the amendment is captured below: Clause 66 of the Bill seeks to substitute section 269SS of the Income-tax Act relating to mode of taking or accepting certain loans and deposits. 17 ITA No.38/DDN/2023 The existing provision contained in section 269SS provides 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 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 levied penalty u/s 271D of the Act. The intention of the amendment is very clear right from the Budget speech of the Finance Minister that the said amendment is brought into the statute in Section 269SS of the Act would get attracted to sum received in cash as an advance in an immovable property transaction and not to the completed transaction namely cash received as a sale consideration at the time of execution of the registered sale deed. In fact, the statute brought in another amendment in Section 269ST of the Act from the assessment year 2017-18 with a view to cover all situations of cash transaction Rs. 2 Lakhs or over other than the situation captured in Section 269SS of the Act. This provision has been explained with more clarity by the CBDT Circular No.19 of 2015, dated 27.11.2015 and the relevant circular reads as under:- Departmental Circular No.19 of 2015, dated 27-11-2015:- 54. Mode of taking or accepting certain loans, deposits and specified sums and mode of repayment of loans or deposits and specified advances. 54.1 Provisions contained in section 269SS of the Income-tax Act, before amendment by the Act, provided 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 of such loan or deposit is twenty thousand rupees or more. However, certain exceptions were provided in the section. 18 ITA No.38/DDN/2023 54.2 Similarly, the provisions contained in section 269T of the Income-tax Act, before amendment by the Act, provided that any loan or deposit shall not be repaid, otherwise than by an account payee cheque or account payee bank draft or online transfer through a bank account, by the persons specified in the section if the amount of loan or deposit is twenty thousand rupees or more. 54.3 In order to curb generation of black money by way of dealings in cash in immovable property transactions, section 269SS of the Income- tax Act has been amended to provide that no person shall accept from any person any loan or deposit or any sum of money, whether as advance or otherwise, in relation to transfer of an immovable property(specified sum) otherwise than by an account payee cheque or account payee bank draft or by electronic clearing system through a bank account, if the amount of such loan or deposit or such specified sum is twenty thousand 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 money in real estate prohibiting acceptance or repayment of advance in cash of Rs.20,000/- or more for any transaction in immovable property. This was explained by Hon'ble Finance Minister while placing the Finance Bill, 2015 in her budget speech highlighting the intention of the amendment that the amendment in Explanation to Section 269SS i.e., 'sum specified' means only applicable for advance receivable, whether as advance or otherwise means advance can be in any manner. Hence, this provision will not apply to the transaction that happens at the time of final payment at the time of registration of sale deed and payment is made before sub-registrar at the time of registration of property. In the present case before us, it is an admitted fact that all sale deeds were registered and cash payment was made at one go 19 ITA No.38/DDN/2023 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 in the present case in the given facts and circumstances of the case and hence, penalty is not exigible in this case. Hence, we confirm the order of CIT(A) deleting the penalty but on entirely different ground i.e., on jurisdictional issue only. Accordingly, the appeal of the Revenue is dismissed.” 19. Since the facts in this case are exactly similar to the facts in the above decision, we are inclined to accept the submissions of the assessee and direct Assessing Officer to delete the penalty levied u/s 271D of the Act. 20. In the result, the appeal filed by the assessee is allowed. Order pronounced in the open court on this 18th day of October, 2024. Sd/- sd/- (VIMAL KUMAR) (S. RIFAUR RAHMAN) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated : 18.10.2024 TS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "