Section 269SS does not cover cash sale consideration in registered property transfers; penalty initiation also needs recorded satisfaction.

Cash received as sale consideration in a registered immovable property transaction was held not to constitute a loan, deposit or specified sum within section 269SS, because it formed part of completed sale consideration recorded in the sale deeds; penalty under section 271D was therefore not leviable on that substantive ground. Penalty proceedings were also invalid because initiation under section 271D requires recorded satisfaction in assessment or other proceedings, and no such satisfaction had been recorded by the Assessing Officer; the jurisdictional precondition for penalty was thus absent. On both substantive and procedural grounds, the penalty could not be sustained.

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Issues: (i) Whether cash received as sale consideration for transfer of immovable property, reflected in registered sale deeds, attracts section 269SS and consequent penalty under section 271D. (ii) Whether penalty under section 271D can be initiated and sustained in the absence of satisfaction recorded by the Assessing Officer in assessment or other proceedings.

Issue (i): Whether cash received as sale consideration for transfer of immovable property, reflected in registered sale deeds, attracts section 269SS and consequent penalty under section 271D.

Analysis: Section 269SS, as amended, covers loans, deposits and specified sums, and the expression "specified sum" was introduced to curb cash advances and similar receipts in relation to immovable property transactions. The receipt of consideration at the time of execution and registration of sale deeds was treated as distinct from an advance or loan-like transaction. On the facts, the cash was received as part of the completed sale consideration and was duly recorded in the registered instruments.

Conclusion: The cash receipt in the course of the registered property transfer did not fall within the mischief of section 269SS, and penalty under section 271D was not leviable on that ground.

Issue (ii): Whether penalty under section 271D can be initiated and sustained in the absence of satisfaction recorded by the Assessing Officer in assessment or other proceedings.

Analysis: Penalty under section 271D is linked to a contravention noticed in assessment or other proceedings, and the jurisdictional foundation requires that the Assessing Officer record the necessary satisfaction in such proceedings. In the absence of any assessment proceedings or recorded satisfaction, initiation by the Joint Commissioner was held to be invalid. The contrary view based on limitation did not assist the Revenue because the core defect was the absence of the statutory pre-condition for initiation.

Conclusion: The penalty proceedings were invalid for want of recorded satisfaction in assessment or other proceedings, and the penalty could not be sustained.

Final Conclusion: The penalty was deleted on both the substantive and jurisdictional grounds, leaving no basis for sustaining the impugned levy.

Ratio Decidendi: Cash received as sale consideration in a registered immovable property transaction is not, by itself, a specified sum within section 269SS, and initiation of penalty under section 271D requires recorded satisfaction in assessment or other proceedings as a jurisdictional precondition.

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