TaxTMI 
TaxTMI 
2023 (10) TMI 1598
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....of the case, the Id. Commissioner of Income Tax (Appeals) erred in not appreciating the legal position that the bona fide concluded transactions would not come within the purview of the section 269SS of the Act. The Id. Commissioner (Appeals) ought to have appreciated that the section is applicable only to the cases where the assessee makes an attempt to explain the cash by way of loan or investment or advance in cash. 3. Without prejudice, the Id. Commissioner of Income Tax (Appeals) failed to appreciate the bona fides of the Appellant and erred in holding that the reasons offered by the Appellant would not fall within the ambit of reasonable cause for failure to comply with the provisions of section 269SS of the Act. 4. On the facts and in the circumstances of the case and given the back ground of the Appellant, the ld. Commissioner (Appeals) ought to have held that the levy of penalty under section 271D of the Act is not justified and therefore should have deleted the same. 5. On the facts and in the circumstances of the case, the Id. Commissioner (Appeals) erred in holding that the precedents cited are not applicable to the facts of the present case a....
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....filed by the assessee before the ld.CIT(A) who has not considered the same while passing the order. The relevant portion of written submissions of the assessee filed before the ld.CIT(A) are observed as under : "....... 8. The provisions of section 269SS of the Act defines "specified transaction", and it refers to 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. It is respectfully submitted that the provision is introduced to plug the, loop hole of cash being explained by the assessee as being received and is liable to paid back as it was received as "advance" or "sale consideration" for whatever reasons. This can be discerned from the words used viz., RECEIVABLE. If it is a case where it applies to cash received, then the 'word "RECEIVED" also would have been used. It is respectfully submitted that in the present case the sale consideration is p1 ready received in respect of concluded transaction and therefore, the same is 'not covered within the meaning of the term, "specified sum' as defined in section 269SS of the Act. It is therefore submitted t....
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....ceiling on cash transactions is not widely canvassed unlike section 139A of the Act dealing with filing of return of income under 1/6 criteria or. demonetization of specified notes. The Government of India also canvasses widely for payment of advance tax and filing of returns by assessees. But the introduction of the "specified transaction" in section 269SS of the Act, which altered the age old practice of transactions through cash, has not at all been publicized. On account of the same, people like the appellant are suffering for the alleged violation. Therefore, given the back ground of the case, it would be improper to take a stringent view of the matter and sustaining the levy of penalty. 12. It is 'submitted that the Hon'ble Apex court in the case of Hindustan Steels Ltd Vs. State of Orissa (1972) 83 ITR 26 SC held 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 provision....
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....ed above, there is no finding of the assessing authority, the appellate authority or the Tribunal that the transaction made by the assessee in breach of the provisions of section 269SS was not a genuine transaction. On the contrary, the return filed by the assessee was accepted after scrutiny under section 143(3) of the Act. Further, there is no finding of the appellate authority that the transaction in breach of the aforesaid provisions made by the assessee was mala fide and with the sole object to conceal the Income. The authorities have proceeded on the basis that breach of condition provided under section 269SS of the Act shall lead to penal consequences In our view, in the facts and circumstances of the case, the imposition of penalty merely on technical mistake committed by the assessee, which has not resulted in any loss of revenue, shall be harsh and cannot be sustained in law. (iv) CIT-v-Smt. Dimple Yadav 379 ITR 177 (All HO) wherein it we observed that object behind such legislation was to ensure that a tax payer was not allowed to give the false explanation for his unaccounted money. Thus, in order to curb the menace of black money, section 269S5 visa introduced....
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....and, we do not go further. We expound those words.in the natural and ordinary sense of the words. But, if the words are ambiguous, uncertain or any doubt arises as to the terms employed, we deem it as our paramount duty to put upon the language of the legislature rational meaning. We examine the necessity which gave rise to the act. We will not view the provision as abstract principles separated from the motive force behind. We will consider the provision in the circumstances to which they own their origin. The purpose and rationale behind the introduction of section 269SS was to curb the black money. The purpose and rational has to be watched for introduction of section 269SS of the at not by its Words and its grammatical meaning. 14. It is submitted that in the present case, there is no generation of black money. The assessee proved bonafides beyond the shadow of doubt. Once bonafide is proved what retains is only procedural default which is of a venial nature. It is submitted 'that reasonable cause means genuine belief based on reasonable grounds. 15. It is submitted that section 273B of the Act prescribes' that penalty should not be imposed if there ex....
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.... and sale of the immovable property should have been made by following the manner provided by the Act and not by sale of property in cash. However, the assessee has not changed his conduct and had wrongly accepted the cash payment in violation of section 269SS of the Act. Ld. DR further contended that once the amount was received in cash, in violation of provisions of section 269SS of the Act r.w.s 271D, then penalty was rightly imposed by the Assessing Officer. He also relied upon the decision of Tribunal in ITA No. 28/Hyd/2023 dt. 21.09.2023 wherein the Tribunal has held that penalty is leviable in case of violation of provisions of section 269SS of the Act. 9. We have heard the rival submissions and perused the material on record and also the provisions of section 269SS of the Act. From the perusal of provisions of section 269SS, more particularly, the definition of "Specified Sum" as available in Explanation 4, clearly indicates that if the assessee receives any sum of money either by advance or otherwise in relation to transfer of immovable property then the said transaction would fall within the realm of section 269SS of the Act. The words "otherwise" used in the defi....