IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘H’, NEW DELHI Before Sh. Kul Bharat, Judicial Member Dr. B. R. R. Kumar, Accountant Member ITA No. 2561/Del/2022 : Asstt. Year : 2018-19

Sh. Ankur Aggarwal, CA Revenue by : Sh. Siddharth Bhimsingh Meena, Sr. DR Date of Hearing: 06.03.2024 Date of Pronouncement: 02.04.2024

ORDER

Per Dr. B. R. R. Kumar, Accountant Member:

The present appeal has been filed by the assessee against the order of ld. CIT(A)-23, New Delhi dated 12.09.2022.

2. Following grounds have been raised by the assessee:

“1. That the order dated 12.09.2022 passed u/s 250 of the Income-tax Act, 1961 (hereinafter called “the Act”) by the Ld. Commissioner of Income-Tax (Appeals) -23, Delhi is against law and facts on the file in as much as he was not justified to partly uphold the action of the Learned Assessing Officer by restricting the penalty levied u/s 271DA of the Act to Rs. 12,60,300/- as against Rs.25,78,300/- levied by the Ld. Assessing Officer for alleged splitting of bills made by the Appellant Company during the year under consideration and alleged contravention of the provisions of Section 269ST on cash receipts of Rs. 2,00,000/- or more in AY 2018-19 by ignoring the facts and circumstances of the case and submissions filed on behalf of the Appellant Company.”

3. The grounds of appeal are related to levy of penalty u/s 271DA of the Income Tax Act, 1961 on cash receipts of Rs.2,00,000/- by the assessee. Penalty order u/s 271D of the Act has been passed in consequence to the proceedings of search and seizure operation that was conducted on Sh. Rishi Kishan Mehra and Shantanu Mehra, Directors of M/s Finessee international Design Pvt. Ltd. on 29.05.2018 u/s 132A. During the search operation, incriminating documents related to the assessee were found and seized. Thereafter, proposal for initiating penalty proceedings u/s 271D of the Act was received from the Assessing Officer by the Addl. CIT, Central Range-1, New Delhi. On examination of the impounded documents and Assessment order, it was noted by the Addl. CIT, Central Range-1, New Delhi that the assessee company has violated provisions of section 269ST of Income Tax Act, 1961 by way of cash receipts of Rs.2,00,000/- or more from a single persons by splitting the invoices against sale of goods at its stores.

4. Aggrieved, the assessee filed appeal before the ld. CIT(A).

5. The ld. CIT(A) deleted the penalty levied made on account of transactions through the bank and confirmed the transactions made through cash.

6. The ld. CIT(A) confirmed the penalty holding that the details of the customers from whom payment in cash exceeding Rs.2,00,000/- has been examined. The ld. CIT(A) held that the assessee has issued two bills to the customer bifurcating it below Rs.2,00,000/- and the purpose of bifurcating the bills into two is obvious i.e. circumventing the provisions of section 269ST. The ld. CIT(A) held that no person issues two bills to the same customer for two different items. The ld. CIT(A) opined that if anyone goes to a shop and purchases 10 items, the bill is one for all the items and the payment is also made in one go.

7. Heard the arguments of both the parties and perused the material available on record.

8. The details are as under: