$~6 * IN THE HIGH COURT OF DELHI AT NEW DELHI % Date of Decision: 20.01.2025 + W.P.(C) 17371/2024 PROPERTY PLUS REALTORS .....Petitioner Through: Mr. Deepak Kapoor, Advocate versus UNION OF INDIA & ORS. .....Respondents Through: Mr. Sanjay Kumar, SSC, Ms. Monica Benjamin and Ms. Easha Kadian, JSCs CORAM:

HON'BLE THE ACTING CHIEF JUSTICE HON'BLE MR. JUSTICE TUSHAR RAO GEDELA VIBHU BAKHRU, J. (ORAL

1. The petitioner has filed the present petition, inter alia, praying as under:-

(a) “Issue a writ of certiorari, or any other appropriate writ, Order or direction quashing the Impugned Order dated 17.10.2024 passed by the Respondent no.3 under section 271DA of the Income Tax Act, 1961(“The Act”) and all proceedings emanating therefrom including demand notice dated 17.10.2024 u/s 156 of the Act and the Show Cause Notices U/s 271DA dated 09.09.2024 and

27.09.2024 relating to AY 2022-23 (b) Pass any other Order/(s) that this Hon’ble Court may deem fit and proper in the facts and circumstances of the case herein and in the interest of justice.”

2. The petitioner is a partnership firm constituted on 20.12.2017 and at the material time was engaged in a business of acting as real estate brokers.

Signature Not Verified Digitally Signed W.P.(C) 17371/2024 Page 1 of 11 It is stated that the petitioner had acted for various real estate companies including Gaursons Group of Companies (hereafter the Gaursons Group).

3. On 02.03.2022, a search was conducted under Section 132 of the Income Tax Act, 1961 (hereafter the Act) in the premises of the entities comprising the Gaursons Group and other related persons. Simultaneously, a search was also conducted in the premises of the petitioner as well as in the premises of its constituted partners.

4. The petitioner filed his return for the relevant assessment year (AY) 2022-23 after the search was conducted. The said return was taken up for scrutiny and the proceedings culminated in an assessment order dated 28.03.2024. The net profit of the assessee was determined at Rs. 22,29,92,302/- against a returned income of Rs. 9,77,91,650/-. In addition, the Assessing Officer (AO) also decided that the penalty proceedings be initiated in respect of the cash allegedly received by the petitioner.

5. Paragraph 14.17, 14.18 and 14.19 of the assessment order are relevant and are set out below:

“14.17 Further, I am satisfied that this is a fit case for initiation of penalty proceedings, hence, penalty proceedings U/s 271AAB(1A)(b) of the IT Act, 1961, is being initiated separately on the above issue for undisclosed income.

14.18 Further, I am satisfied that this is a fit case for initiation of penalty proceedings u/s 271AAD(1)(ii) of the Act, and hence, penalty proceedings u/s 271AAD(1)(i) & (ii) of the Act are being initiated separately in this case for false entry as well as omission of entry in the books of accounts which is relevant for computation of total income of the assessee.

Signature Not Verified Digitally Signed W.P.(C) 17371/2024 Page 2 of 11

14.19 Further, separate reference is being sent to the office of Addl. CIT-Central Range-04, Delhi for initiation of penalty proceedings U/s 269ST of the IT Act, 1961, in this case on the issue of cash receipts by the assessee.”

6. Accordingly, the AO made a reference to the Additional Commissioner of Income Tax on 08.04.2024 for initiation of penalty proceedings under Section 269ST of the Act, read with 271DA of the Act. A copy of the said reference letter dated was handed over to the court during the course of proceedings by the learned counsel for the Revenue. The same is set out below.

“OFFICE OF THE DY. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-15, NEW DELHI Room No. 245, ARA Centre, E-2, Jhandewalan Extn., New Delhi-

110055. Ph: 011-23593441.

F. No. DCIT/CC-15/2024-25/42 Date: 08/04/2024 To., The Addl. Commissioner of Income Tax, Central Range-4, New Delhi.

Respected Sir, Sub: Reference for initiation of penalty u/s 269ST r.w.s 271DA of the I.T Act, 1961, for cash received more