JITENDRA KUMAR KATIYAR,CHHIBRAMAU KANNAUJ vs. ITO, HARDWAR

ITA No.130/DDN/2026 JITENDRA KUMAR KATIYAR IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “DB” NEW DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER ITA No.130/DDN/2026 Assessment Year: 2018-19 JITENDRA KUMAR KATIYAR, Vs JOINT COMMISSIONER OF INCOME TAX, Mohalla Tiwariyan Chhibramau, Range (1), Aaykar Bhawan, Kannauj, Uttar Pradesh 209721. 13-A, Subhash Road, Dehradun, PAN No. CFMPB9040Q Uttarakhand 248001. Appellant Respondent Assessee by Shri Arun Gangwar, Adv. Revenue by Shri Amar Pal Singh, Sr. DR (VC) Date of hearing: 22.06.2026 Pronouncement on 24.06.2026 O R D E R PER SANJAY AWASTHI, ACCOUNTANT MEMBER: 1. This appeal arises from order dated 05.03.2026, passed by Ld. CIT(A)-NFAC, u/s 250 of the Income Tax Act, 1961 (hereafter as “the Ac”). In this matter, the assessee’s case was reopened by issuing a notice u/s 148 of the Act. In response to this notice, the assessee filed his return of income for AY 2018-19 by declaring a total income of Rs.2,98,720/-. It is seen that after due consideration, the Ld. AO accepted the income shown in this return and completed the assessment thereon. However, the Ld. AO noticed that an amount of Rs.95,000/- was accepted by the assessee from his brother, Shri Mahendra Kumar, as an unsecured loan on 22.05.2017. It was alleged that this loan was accepted

ITA No.130/DDN/2026 JITENDRA KUMAR KATIYAR in cash and therefore in violation of the provisions of section 269SS of the Act. Subsequently, the Assessment Unit levied a penalty of like amount u/s 271D of the Act.

1.1 The aggrieved assessee approached the Ld. CIT(A), where also he could not succeed as it was held that the loan was taken in contravention of the provisions of section 269SS of the Act. Interestingly, this was in spite of the fact that the assessee claimed that out of this Rs.95,000/- only Rs.5,000/- was accepted in cash on 22.05.2017 and remaining Rs.40,000/- (on 25.07.2017) and Rs.50,000/- (on 26.07.2017) were actually received through bank transfers.

1.2 Further aggrieved, the assessee has approached the ITAT with grounds challenging the action of Ld. CIT(A) and it is seen that the assessee has also filed additional grounds challenging the assumption of jurisdiction by the Ld. AO. However, the Ld. AR requested that the facts may be dealt with first before any legal issue could be deemed fit for adjudication.

ITA No.130/DDN/2026 JITENDRA KUMAR KATIYAR additional evidence before the Ld. AO but no cognizance was taken of the same. The Ld. AR took us through the bank account details and demonstrated that actually a transaction of Rs.95,000/- on 22.05.2017 was shown as a cash deposit but that was part of the receipts from sale of cattle feed. It was explained by the Ld. AR that in the assessee’s line of business cash sales were routinely made. Thereafter, the Ld. AR took us through the PNB account of the assessee where Rs.5,000/- was shown on 22.05.2017, Rs.40,000/- on 25.07.2017 and Rs.50,000/- was shown on 26.07.2017. It was mentioned that only Rs.5,000/- was in cash while the remaining two amounts were through bank transfer. It was stated that since only Rs.5,000/- was taken in cash, there was no violation of section 269SS of the Act, meriting a penalty u/s 271D of the Act.

2.1 Per contra, the Ld. DR relied on the orders of the authorities below and stated that the assessee had changed his stance continuously and it was mentioned that there is a clear finding in the penalty order on page 1 that the assessee had himself stated that Rs.95,000/- was accepted in cash from the brother of the assessee. It was also pointed out by the Ld. DR that there is an entry indicating Rs.95,000/- on 22.05.2017 which has now been explained as a receipt on account of cash sales. The Ld. DR supported the orders of the authorities below and stated that the penalty was justifiably levied.

ITA No.130/DDN/2026 JITENDRA KUMAR KATIYAR 3. We have carefully considered the rival submissions and have gone through the records before us. While the facts are not in doubt that indeed there was a cash deposit of Rs.95,000/- on 22.05.2017 but it is also a fact that on 25.07.2017 and 26.07.2017 there are two bank transfers of Rs.40,000/- and Rs.50,000/- respectively. It is entirely plausible that the assessee made a mistake in the narration supporting the bank account entry and once penalty proceedings were initiated then he duly attempted to correct the oversight. It is not understood why the assessing authorities doggedly insisted on adopting a version of events suitable to them and did not check if at all the entries of Rs.40,000/- and Rs.50,000/- had indeed come from the brother of the assessee through banking channels. At this juncture, we may also refer to the provisions of section 273B of the Act, whereby provisions for relief from penalties like the one under consideration, have been mandated on the basis of “reasonable cause”. We find that the assessee has duly explained the entries and such explanations have not found favour with the assessing authorities. On the contrary, we find substance in the assessee’s submissions and unhesitatingly hold that only Rs.5,000/- has been accepted in cash and thus, there could be no ground for levying any penalty u/s 271D of the Act. We direct the deletion of the impugned penalty accordingly.

ITA No.130/DDN/2026 JITENDRA KUMAR KATIYAR 3.1 Since the assessee has succeeded on the main ground of levy of penalty, we do not deem it fit to adjudicate on any of the legal grounds tendered before us in the shape of additional grounds.

Order pronounced in the open court on 24.06.2026

Sd/- Sd/- (ANUBHAV SHARMA) (SANJAY AWASTHI) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 24.06.2026 *Kavita Arora, Sr. P.S. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI