Maheshwarappa Muniramu Vs JCIT (ITAT Bangalore)
ITAT Bangalore Deletes Penalty u/s 271D on Cash Receipt from Property Sale – Reasonable Cause Established- Section 273B Relief Applied- Senior Citizen’s Bona Fide Belief Saves from Penalty on Cash Transaction- ITAT: Penalty Not Automatic – Genuine Transaction Exempted from 271D
Bangalore ITAT considered levy of penalty u/s 271D for alleged violation of Section 269SS on receipt of cash.
Assessee, a senior citizen aged 82, along with his son sold immovable property for ₹85,43,100 on 30/06/2016. Out of his 50% share, he received ₹10,00,000 in cash, which was immediately deposited into his bank account & later transferred to Capital Gains Account Scheme. AO completed assessment u/s 143(3) on 06/02/2019 accepting returned income without noting any 269SS violation. However, JCIT later (after more than 2 years) initiated penalty proceedings & levied penalty of ₹20 lakh u/s 271D, alleging contravention of 269SS.
Assessee argued that he is illiterate (educated up to 4th standard), aged & ailing, and under bona fide belief that receipt of part sale consideration in cash was permissible. He highlighted that the transaction was genuine, duly reflected in sale deed, TDS was deducted, & proceeds were deposited into bank and then capital gain account.
