TaxTMI 
TaxTMI 
2026 (10) TMI 278
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.... not file her return of income for the A.Y. 2017-18 within the prescribed time. Accordingly, the A.O. issued notice u/s 142(1) of the Income-tax Act, 1961 on 30.01.2018. During the relevant financial year 2016-17, the assessee deposited cash aggregating to Rs. 26,98,051/- in her bank account maintained with State Bank of India during the demonetization period between 09.11.2016 and 30.12.2016. During the course of assessment proceedings, the assessee explained that, the cash deposits were out of the sale consideration received from sale of an open plot of land bearing Plot No.76/1 in Sy. No.124, near Nagole village, admeasuring 333.33 sq. yards, for a total consideration of Rs. 26,67,000/- vide registered sale deed dated 13.12.2016. The ass....
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....ntemplated u/s 269SS of the Act. The assessee further submitted that, the transaction was genuine and the sale consideration was duly disclosed and that there was reasonable cause for receipt of the partial sale consideration in cash. The assessee also raised an additional ground challenging the validity of the penalty proceedings on the ground that the A.O. had not recorded satisfaction in the assessment order before initiating penalty proceedings u/s 271D of the Act. 5. The Ld. CIT(A), after considering the submissions of the assessee, observed that, the A.O. had clearly noted the receipt of cash of Rs. 14,70,000/- prior to execution of the registered sale deed and had formed a prima facie opinion that such receipt was in violation of ....
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....sel for the assessee further, referring to the sale transaction, submitted that the assessee had sold the immovable property for a total consideration of Rs. 26,67,000/- and that the amount of Rs. 14,70,000/- alleged to have been received in cash was part of the sale consideration. He submitted that the registered sale deed was executed on 13.12.2016 and that the amount received represented part of the sale consideration and not any loan or deposit. He further submitted that, the provisions of Section 269SS of the Act, were not applicable to the transaction in the manner alleged by the A.O. and, therefore, the penalty levied u/s 271D of the Act should be deleted. 8. The learned Senior A.R. for the Revenue, Shri B. Laxmi Kanth, on the oth....
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.... Insofar as the issue of satisfaction recorded by the A.O. is concerned, we have gone through the relevant assessment order passed by the A.O. We find that, the A.O. has not recorded any satisfaction in the assessment order for initiation of penalty proceedings u/s 271D of the Act. Although the A.O. is required to initiate penalty proceedings u/s 271D of the Act, he must record satisfaction regarding violation of Section 269SS of the Act, which attracts the provisions of Section 271D of the Act, and such satisfaction must be recorded during the course of assessment proceedings, as held by the Hon'ble Supreme Court in the case of CIT Vs. Jai Laxmi Rice Mills, Ambala City (supra). Similar view has been taken by the Hon'ble High Court of Andhr....