NEETU KALRA,DELHI vs. CIT APPEALS, NEW DELHI

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ITA 3913/DEL/2026Status: DisposedITAT Delhi31 July 2026AY 2017-20183 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the penalty under Section 271D was wrongly levied. The cash received was part of an agreement to sell, and a rectification deed corrected the date of receipt, indicating no intent to violate Section 269SS.

What were the facts?

The assessee and her mother-in-law jointly owned a property and entered into an agreement to sell it. A significant portion of the sale consideration was received in cash at the time of the agreement, which was later rectified in a deed.

What were the issues?

Whether penalty under Section 271D is leviable for cash receipt when a rectification deed corrects the date of receipt, implying no violation of Section 269SS.

Which sections of the Income-tax Act were involved?

Section 271D,Section 269SS,Section 274

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI

Before: SHRI VIKAS AWASTHY&

For Respondent: Ms. Harpreet Kaur Hansra Sr. DR

PER SHRI VIKAS AWASTHY, JUDICIAL MEMBER: This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short ‘the CIT(A)’] dated 09.02.2026, for Assessment Year 2017-18.

2.

Shri Prateek Gupta, appearing on behalf of the assessee submits that the assessee in appeal has assailed the order of CIT(A) in upholding penalty levied u/s.271D of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). He submits that the assessee and Mrs. Urmila Kalra her mother-in-law jointly owned immovable property bearing no. B-509, First Floor, Sudershan Park, New Delhi in equal undivided share of 50% each. The assessee and Mrs. Urmila Kalra entered into an agreement to sell aforesaid property with Shri Rajesh Mendiratta on 24.10.2014 for a consideration of Rs.17,10,000/-. The said property was sold vide registered sale deed dated 29.10.2016. From the total consideration of Rs.17,10,000/-, Rs.5,10,000/- were received in cash at the time of entering agreement to sell. The share of assessee in the cash

ITA 3913/DEL/2026 NEETU KALRA received as part of consideration was Rs.2,55,000/-. The assessee and her mother-in-law received showcause notice dated 11.12.2024 u/s.274 r.w.s. 271D of the Act for violation of provisions of section 269SS of the Act. The assessee and Mrs. Urmila Kalra in reply to the showcause notice explained that in Sale Deed the year of receipt cash consideration has been wrongly mentioned as 2016 instead of 2014. It was further explained that the assessee has executed Registered Deed of Rectification for correcting dates in the Sale Deed before the Sub Registrar office on 08.01.2025. The actual dates on which cash payments were received are as under:-

Amount Mode Incorrect Date Correct Date 1,00,000/- Cash 24.10.2016 24.10.2014 2,00,000/- Cash 31.10.2016 31.10.2014 1,00,000/- Cash 02.11.2016 02.11.2014 1,10,000/- Cash 07.11.2016 07.11.2014 3. Consequent to Rectification Deed dated 08.01.2025 penalty proceedings initiated u/s.271D of the Act in the case of Mrs. Urmila Kalra were dropped. The ld. Counsel placed on record a copy of order u/s.271D of the Act dated 26.06.2025 in the case of Mrs. Urmila Kalra. The ld. Counsel for parity of reasons prayed for quashing penalty order in the case of assessee as well.

4.

Per contra, Ms. Harpreet Kaur Hansra, strongly supporting the impugned order prayed for dismissing appeal of assessee. The ld. DR submits that the assessee has violated provisions of section 269SS of the Act by accepting cash amounting to Rs.5,10,000/- during the period relevant to assessment year under appeal. She further stated that the assessee had made Deed of Rectification of sale deed after initiation of penalty proceedings u/s.271D of the Act. This clearly shows that the rectification in sale deed is an afterthought to circumvent penalty u/s.271D of the Act.

5.

Both sides heard, orders of the lower authorities examined. The AO initiated penalty proceedings u/s.271D of the Act for contravention of provisions of section 269SS of the Act. The assessee allegedly received part consideration on sale of immovable property during the Financial Year 2016-17 in cash. The immovable property that was sold during the year was jointly owned by assessee with her mother-in-law Mrs. Urmila Kalra in equal share. The cash component of the total consideration received by both owners aggregate to Rs.5,10,000/-. Penalty proceedings u/s.271D of the Act were also initiated against the Smt. Urmila Kalra. It is contended that cash part of sale consideration Rs.5,10,000/- was in fact received during FY i.e. 2014-15 on 24.10.2014, 31.10.2014, 02.11.2014 and 07.11.2014. Inadvertently, the aforesaid 2

ITA 3913/DEL/2026 NEETU KALRA dates were recorded in sale deed as 24.10.2016, 31.10.2016, 02.11.2016 and 07.11.2016. The aforesaid mistake in the Sale Deed was rectified by way of Deed of Rectification dated 08.01.2025. In light of the said Rectification deed, the AO in the case of Smt. Urmila Kalra vide order dated 26.06.2025 levied no penalty u/s.271D of the Act. The assessee, being co- owner of the same immovable property, deserves the same treatment on the principle of parity. Accordingly, for similar reasons penalty levied u/s.271D of the Act is directed to be deleted.

6.

In the result, impugned order is set aside and appeal of the assessee is allowed.

Order pronounced in the open court on Friday the 31st day of July, 2026.

Sd/- Sd/- AMITABH SHUKLA VIKAS AWASTHY ACCOUNTANT MEMBER JUDICIAL MEMBER

Delhi Dated: 31-July-2026 NV/-

Copy to: 1 NEETU KALRA 5/4, MOTI NAGAR, NEW DELHI 110015 2 COMMISSIONER OF INCOME TAX (APPEALS) NFAC, NEW DELHI 110001 3 THE PCIT / CIT, 4 THE D.R., ITAT, DELHI BENCH 5 GUARD FILE

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