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ITAT Cuttack Cancels Penalty for Cash Payments in Property Sale
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What Happened?
The ITAT Cuttack ruled in favor of a taxpayer penalized for cash payments from property sales, stating the wrong tax section was invoked. The taxpayer had declared the transactions and paid capital gains tax.
Key points
- The taxpayer sold two properties for Rs 47.54 lakh, receiving cash payments.
- He declared the transactions in his income tax return and paid the capital gains tax.
- The Assessing Officer imposed a penalty under Section 271D for cash payments.
- ITAT Cuttack ruled that Section 269SS did not apply to the transactions.
- The tribunal noted that the correct section to invoke was Section 269ST.
Key insights
- The ruling may influence how cash transactions are treated in future property sales.
- Taxpayers should ensure compliance with the correct sections of the Income-tax Act to avoid penalties.
- The Income Tax Department may initiate new proceedings under the applicable provisions.
Why it matters
This ruling clarifies the application of tax laws regarding cash payments in property transactions.
Source
Times of India
