TMI Blog2024 (1) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... o the decision of the Hon ble Apex Court in the case of Jai Laxmi Rice Mills [ 2015 (11) TMI 1453 - SUPREME COURT] the Hon ble High Court held that the provisions under section 271E and 271D of the Act are in pari materia and since in terms of the decision in Jai Laxmi Rice Mills (supra), satisfaction must be recorded in the original assessment order for the purpose of initiation of penalty proceedings under section 271E of the Act, the same is equally applicable for initiation of penalty proceedings under section 271D of the Act. Assessee appeal allowed. - Shri K. Narasimha Chary, Judicial Member For the Assessee : Smt. S. Sandhya, AR For the Revenue : Ms. Aditi Goyal, DR ORDER Aggrieved by the order dated 06/10/2023 passed by the learned Commissioner of Income Tax (Appeals)- National Faceless Appeal Centre (NFAC), Delhi ( Ld. CIT(A) ), in the case of Parvathi Garlapati ( the assessee ) for the assessment year 2017-18, assessee preferred this appeal. 2. Brief facts of the case are that on the ground that during the financial year relevant to assessment year 2017-18, the assessee sold immovable property on 11/07/2016 to Smt. Tadisetty Bhavani, W/o. Sri Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of penalty under section 271D/271E of the Act, there must be assessment proceedings or proceeding arising from assessment order are pending in the case of the assessee, and, therefore, following the judgment of Hon ble Supreme Court as well as Co-ordinate Bench of the Tribunal in case of Vijayaben G. Zalavadia vs. JCIT (supra), deleted the penalty levied under section 271D of the Act by holding that without any assessment proceedings in the case of the assessee such penalty is not valid and liable to be quashed. 7. Further, this question has directly and substantially been dealt with by the Hon ble jurisdictional High Court in the case of Srinivasa Reddy Reddeppagari (supra). In that case, while referring to the decision of the Hon ble Apex Court in the case of Jai Laxmi Rice Mills (supra), the Hon ble High Court held that the provisions under section 271E and 271D of the Act are in pari materia and since in terms of the decision in Jai Laxmi Rice Mills (supra), satisfaction must be recorded in the original assessment order for the purpose of initiation of penalty proceedings under section 271E of the Act, the same is equally applicable for initiation of penalty proceedings und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 269SS of the Act. Section 271D of the Act being relevant is extracted hereunder: Penalty for failure to comply with the provisions of section 269SS. 271D. (1) If a person takes or accepts any loan or deposit [or specified sum] in contravention of the provisions of section 269SS, he shall be liable to pay, by way of penalty, a sum equal to the amount of the loan or deposit [or specified sum] so taken or accepted.] [(2) Any penalty imposable under sub- section (1) shall be imposed by the [Joint] Commissioner.] 19. Thus, what sub-section (1) of Section 271D provides for is that if a person takes or accepts any loan or deposit or specified amount in contravention of the provisions of Section 269SS, he shall be liable to pay by way of penalty, a sum equal to the amount of the loan or deposit or specified sum so taken or accepted. Sub-section (2) clarifies that any penalty imposable under sub-section (1) shall be imposed by the Joint Commissioner. 20. It would be useful to refer to Section 271E of the Act also at this stage which deals with penalty for failure to comply with the provisions of Section 269T of the Act. Be it stated that Section 269T of the Act provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessment proceeding ? In the facts of that case, it was found that the penalty order was issued following the assessment order. However in appeal, Commissioner of Income Tax (Appeals) had set aside the original assessment order with a direction to frame assessment de novo. In the fresh assessment order, no satisfaction was recorded by the assessing officer regarding initiation of penalty proceedings under Section 271E of the Act. It was noticed that the penalty order was passed before the appeal of the assessee was allowed by the Commissioner of Income Tax (Appeals). It was in that context that Supreme Court held as follows: The Tribunal as well as the High Court has held that it could not be so for the simple reason that when the original assessment order itself was set aside, the satisfaction recorded therein for the purpose of initiation of the penalty proceeding under Section 271E would also not survive. This according to us is the correct proposition of law stated by the High Court in the impugned order. As pointed out above, insofar as, fresh assessment order is concerned, there was no satisfaction recorded regarding penalty proceeding under Section 271E of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court. 26. Article 141 of the Constitution of India is clear that law declared by the Supreme Court shall be binding on all courts within the territory of India. This is further clarified in Article 144, which says that all authorities, civil and judicial, in the territory of India shall act in aid of the Supreme Court. We are therefore, of the unhesitant view that respondent No.1 overlooked the relevant considerations while passing the impugned order dated.29.11.2022. 27. Further, issue in the present writ petition is not the competence of the Joint Commissioner in issuing the order of penalty. Therefore, reference to Grihalaxmi Vision (2 supra) was wholly unnecessary. 28. Consequently, we set aside the impugned order dated 29.11.2022 and remand the matter back to the file of respondent No.1 to pass a fresh order in accordance with law after giving a reasonable opportunity of hearing to the petitioner. 8. While respectfully following the decision of the Hon ble jurisdictional High Court as extracted above, I hold that the impugned orders dated 06/10/2023 passed by the learned CIT(A) and order dated 19/12/2019 passed by the Joint Commissioner of Income T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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