TaxTMI 
TaxTMI 
2026 (8) TMI 1351
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....n cash payments against sales of immovable property. 3. The Assessee was having reasonable cause u/s 273-B for receiving cash from the purchaser of the property in question. The purchaser of the property was not very much familiar to the seller and to accept further cheques or any mode through bank was risky and may cause loss to the sellers. The property sold was very small and total amount of consideration was only Rs. 7,50,000/-, so part payment was accepted in cash. Your good self is requested to delete the huge penalty of Rs. 2,75,000/-. 3. The assessee has moved the application to admit the additional ground raised by the assessee Heard. The application is allowed and the additional ground is admitted for adjudication. 4. The additional ground raised by assessee as under: 4. That in the case of sales of Residential Property involved partly cash payments during the financial year 2016-17 covers section 269St not the Section 269SS of the I.T. Act, 1961. But Section 269ST came into effect from 01-04-2017 hence not applicable in this case. Section 269SS of the I. T. Act is not applicable when final payment is received for registration of sales of residenti....
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.... confirmed. 6.1 Aggrieved the order of the Ld. NFAC, the assessee is in appeal before the tribunal. 7. The Ld. AR of the assessee submitted that the penalty against the cash receipt of consideration for the sale of property can be levied under section 269ST not the section 269SS of the Act. He also submitted that penalty can be imposed under section 271DA of the Act not the 271D of the Act. Reliance is placed the Judgment of the Hon'ble Supreme Court in the case of Rbanms Educational Institution vs. B. Guna Shekar AIR 2025 page 2065 in the this case The Hon'ble Supreme Court held as under: 18.1. Further, through the averments made in the plaint and in the agreement, the respondents/plaintiffs have claimed to have paid huge sum towards consideration by cash. It is pertinent to recall that Section 269ST of the Income Tax Act, was introduced to curb black money by digitalising the transactions above Rs. 2,00,000/- and contemplating equal amount of penalty under Section 271DA of the Act. As per the said provisions, action is to be taken on the recipient. However, there is also an onus on the plaintiffs to disclose their source for such huge cash. The Central Government t....
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....er persons or class of persons or receipts may be notified by the Central Government, for reasons to be recorded in writing, on whom the proposed restriction on cash transactions shall not apply. Transactions of the nature referred to in section 269SS are proposed to be excluded from the scope of the said section. It is also proposed to insert new section 271DA in the Act to provide for levy of penalty on a person who receives a sum in contravention of the provisions of the proposed section 269ST. The penalty is proposed to be a sum equal to the amount of such receipt. The said penalty shall however not be levied if the person proves that there were good and sufficient reasons for such contravention. It is also proposed that any such penalty shall be levied by the Joint Commissioner. It is also proposed to consequentially amend the provisions of section 206C to omit the provision relating to tax collection at source at the rate of one per cent. of sale consideration on cash sale of jewellery exceeding five lakh rupees. These amendments will take effect from 1st April 2017." However, when the Bill was passed, the permissible limit was capped under Rupees Two Lakhs, instead ....
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....) This appeal is allowed. (ii) The impugned judgment of the High Court dated 02.06.2022 and the order of the trial Court dated 11.06.2021 are set aside. (iii) As a sequel, the application filed under Order VII Rule 11(a) and (d) CPC is allowed. (iv) The plaint in O.S. No. 25968 of 2018 pending on the file of XIII Additional City Civil and Sessions Judge, Mayohall Unit, Bengaluru, is rejected. (v) The directions given by us in paragraph 18.1 of this judgment shall be intimated by the Registrars of the High Courts, the Chief Secretaries of the States/Union Territories and the Principal Chief Commissioner of Income Tax Department to the District Judiciary, the officials of the registration department and the jurisdictional officers under the Income Tax Department respectively, so as to facilitate the conduct of periodical audit. (vi) The parties shall bear their respective costs throughout the proceedings. (vii) Miscellaneous Application(s), if any, shall stand disposed of. 21. The Registrar (Judicial) is directed to circulate a copy of this Judgment to the Registrar General of all the High Courts, the Chief Secretaries of....