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ONE TIME CASH SALE OF PROPERTY DOES NOT ATTRACT SECTION 269SS

13/01/2026

ONE TIME CASH SALE OF PROPERTY DOES NOT ATTRACT SECTION 269SS

ADV. AKSHITA MATHUR

The assessee sold a plot during FY 2016-17 and received sale consideration of Rs.7.41 Lacs in cash which was in violation of Sec.269SS.

It was admitted position that entire sale consideration was received by the assessee in cash on 01- 07-2016 at the time of execution of sale deed. Considering the same, Ld. AO levied penalty of Rs.7.41 Lacs u/s 271D. The Ld. CIT(A) upheld the same against which the assessee is in further appeal before Tribunal.

It clearly emerges that no assessment has been framed against the assessee for this year since no taxable capital gains has accrued to the assessee on this transaction.

The documents on record would reveal that this transaction has resulted into capital loss to the assessee. However, impugned penalty has been levied for violation of Sec.269SS.

It is an admitted position that the assessee has not received any advance out of sale consideration but has received entire sale consideration in one go at the time of execution of sale deed only. In such a case, Sec.269SS would not apply as per the decision of Chennai Tribunal in ITO vs. Shri R. Dhinagharan (HUF) (ITA No.3329/Chny/2019 dated 29-12-2023)

The intention of amendment by Finance Bill, 2015 including the definition of ‘sum specified’ brought in the Explanation to Section 269SS of the Act, it is clear that the intention for brining this provision was to curb the generation of black money in real estate prohibiting acceptance or repayment of advance in cash of Rs.20,000/- or more for any transaction in immovable property.

Explanation to Section 269SS i.e., ‘sum specified’ means only applicable for advance receivable, whether as advance or otherwise means advance can be in any manner.

Hence, this provision will not apply to the transaction that happens at the time of final payment at the time of registration of sale deed and payment is made before sub- registrar at the time of registration of property.

The appeal stand allowed accordingly.

INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, CHANDIGARH

MRS. SURJIT KAUR V/S ITO, WARD 3

MANOJ KUMAR AGGARWAL, AM

ITA No.1136/CHANDI/2025 (Assessment Year: 2017-18)

06.01.2026