2023 (1) TMI 270 - AT - Income Tax

Penalty u/s 271D - transaction of loan or deposit to attract the penal consequences of Section 269SS - in assessment order, initiated penalty u/s 271(1)(c) - HELD THAT:- AO though, at the time of passing the assessment order, initiated penalty under Section 271(1)(c) of the Act. However, there is no whisper in the assessment order regrading initiation or satisfaction about the initiation of penalty under Section 271D - Add. CIT levied penalty vide order - We find that the Hon’ble Apex Court in CIT Vs Jai Laxmi Rice Mills [2015 (11) TMI 1453 - SUPREME COURT] held that wherein no satisfaction was recorded for initiating penalty proceedings u/s 271E, the impugned penalty order passed under said Section deserve to be set aside.

Considering the fact that there is no satisfaction about initiation of penalty under Section 271D, therefore, respectfully following Jai Laxmi Rice Mills (supra), the penalty levied by Addl. CIT vide his order dated 29/09/2019 is quashed/set aside. In the result, ground of appeal raised by the assessee is allowed.

Considering the fact that we have quashed the penalty order u/s 271D on legal ground on the basis of decision of Hon’ble Apex Court, therefore, consideration and adjudication of the various plea of assessee has become academic. In the result, the sole ground of appeal raised by the assessee is allowed.