Case Law Details
Umakant Sharma Vs JCIT (ITAT Indore)
ITAT Indore held that the penalty levied u/s 271D of the Income Tax Act without any assessment proceedings in the case of the assessee is not valid and liable to be quashed.
Facts- There was a search and seizure action in case of M/s. S. R. Ferro Alloys Group. During the course of search and seizure certain documents were impounded from Shri Ramesh Chand Upadhya showing the cash loan given to various persons including assessee. Accordingly, penalty u/s 271D was imposed on account of contravention of section 269SS of the Income Tax Act.
CIT(A) confirmed the levy of penalty. Being aggrieved, the present appeal is filed.
Conclusion- Held that it is pre-requisite condition that the initiation of penalty 271D/271E of the Act, there must be assessment proceedings or proceeding arising from assessment order are pending in the case of the assessee. Accordingly in the facts and circumstances of the case and following the judgment of Hon’ble Supreme Court as well as Coordinate Bench of the Tribunal in case of Vijayaben G. Zalavadia vs. JCIT, we hold that the penalty levied u/s 271D of the Act without any assessment proceedings in the case of the assessee is not valid and liable to be quashed. We order accordingly.
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