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TMI Blog2024 (12) TMI 316X X X X Extracts X X X X X X X X Extracts X X X X ..... read with Section 274 of the Income Tax Act, 1961 (hereafter the Act) as well as an order dated 17.10.2024 (hereafter the impugned order) passed under Section 271DA of the Act, imposing a penalty of Rs. 12,89,31,909/- in contravention of the provisions of Section 269ST of the Act, pertaining to the assessment year (AY) 2021-22. 2. It is the petitioner's case that the impugned order is barred by limitation. The petitioner is a partnership firm, constituted on 01.01.2017. The petitioner firm was engaged in the business of acting as a real estate broker and has acted as a broker for various developers, including Gaursons Group of Companies (hereafter Gaursons Group). 3. On 02.03.2022, a search was conducted under Section 132 of the Act in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ited question to be examined is whether the impugned order was passed beyond the period of limitation as prescribed under Section 275 (1) (c) of the Act. The said provision is set out below:- "275. Bar of limitation for imposing penalties. (1) No order imposing a penalty under this Chapter shall be passed- (a) xxxxxxx (b) xxxxxxx; (c) in any other case, after the expiry of the financial year in which the proceedings, in the course of which action for the imposition of penalty has been initiated are completed, or six months from the end of the month in which action for imposition of penalty is initiated, whichever period expires later." 7. The controversy, as to the date on which the penalty proceedings are to be construed as init ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order would be within the period of limitation as prescribed under Section 275 (1) (c) of the Act.
10. We are not persuaded to accept this contention. As noted above, the proposal to initiate the penalty proceedings had been forwarded by the AO to respondent no. 3 on 24.03.2023. Further, this court is also unable to countenance that respondent no. 3 had not taken any steps immediately after receipt of the said reference and it waited almost one year to ask for further documents, which was beyond the period prescribed for passing the impugned order under Section 271DA of the Act.
11. In view of the above, the present petition is allowed and the impugned order is set aside. Pending application, if any, also stands disposed of. X X X X Extracts X X X X X X X X Extracts X X X X
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