TaxTMI 
TaxTMI 
2026 (8) TMI 1345
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....he levy of penalty u/s. 271B of the Income Tax Act, 1961 ('the Act') has been sustained. 2. Briefly, the facts of the case are that the assessment in this case was completed under section 143(3) read with section 144B vide order dated 01.03.2025, wherein the returned loss of Rs. 15,70,46,774/- was accepted without making any adjustment/variation to the returned loss. At the same time, penalty proceedings under section 271B were initiated, as the assessee failed to substantiate that out of total receipts, aggregate receipts in cash does not exceed 5%, and also the expenditure in cash does not exceed 5%, to consider the tax audit turnover. 3. Thereafter, during the course of penalty proceedings, after issue of fresh show cause, the Asse....
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....received for sales, turnover, or gross receipts during the previous year in cash does not exceed 5% of the said amount, and aggregate of all payments made including amount incurred for expenditure in cash during the previous year does not exceed 5% of the said payment, then the threshold limit shall be increased to Rs. 10 crores. 7. It was submitted that in the instant case, though the assessee has reported a turnover of Rs. 2,18,93,220/- as against a figure of Rs. 2,94,86,139/- wrongly considered by the Assessing Officer, at the same time, all the receipts are through the proper banking channels, and the assessee does not undertake any receipts in modes other than by way of account payee cheques or other permissible mode as prescribed u....
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....tatements that there are no cash receipts or cash payments and no cash transactions undertaken during the year and inspite of that, the Assessing Officer has levied the penalty under section 271B of the Act. 9. It was submitted that the Assessing Officer has asked the assesse to submit details of cash book receipts and payment account showing total receipts and payments, and to segregate cash and non-cash payments and it was submitted that since the assessee does not undertake receipt and payment transactions in modes other than by way of account payee cheques and other modes admissible as per the Act, the said requirement is not applicable. Further, the assessee has submitted a screen shot of cash register and relevant extract of the fi....
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.... the same with complete evidence, and as a result, the Assessing Officer has levied the penalty under section 271B of the Act which has been rightly sustained by the ld CIT(A). He accordingly supported the order and findings of the ld. CIT(A). 12. We have heard the rival contentions and perused the material available on record. During the course of hearing, with the assistance of ld. AR, we have gone through the financial statements, wherein the assessee has reported revenue from operations amounting to Rs. 2,18,93,220/-, and the corresponding credits in the bank statements, as per the reconciliation statement submitted before us, tallies with the same, except for the difference on account of applicable GST and TDS deducted by customers.....