Genuine bank-to-bank transactions defeat penalty for alleged section 269T violation where no cash or hidden dealing is found.

Penalty under section 271E for alleged violation of section 269T was held unsustainable where the Tribunal found that the transactions were genuine, transparent, and routed only through bank accounts without any cash or hidden dealings. On those factual findings, the foundation for the penalty did not survive, and the deletion of the penalty was upheld in favour of the assessee.

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Issues: Whether the penalty under section 271E of the Income-tax Act, 1961, levied for alleged violation of section 269T of the Income-tax Act, 1961, was rightly deleted on the basis of the factual findings recorded by the Tribunal.

Analysis: The Tribunal recorded a clear finding that the transactions were genuine and transparent, with no cash or hidden dealings, and that the amounts moved only through bank accounts. On those factual findings, the basis for sustaining the penalty did not survive.

Conclusion: The question of law was answered in favour of the assessee and against the department; the penalty deletion was upheld.

Ratio Decidendi: Where the Tribunal records a factual finding that transactions were genuine, transparent, and carried out only through accounts without cash or hidden dealings, penalty for alleged violation of section 269T is not sustainable.

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