Income Tax Penalty if WIFE receives CASH from HUSBANDI CA Satbir Singh

Facts of the Case

Assessee received substantial amount of cash from her husband which was used to purchase property for residence of family members.

Income Tax Officer levied penalty of Rs 3 Lakh u/s 271D of the Income Tax Act, 1961.

CIT (A) also rejected the appeal of the Assessee.

 Decision by ITAT

We find the explanation so furnished as reasonable and plausible and do not find any mala fide in the explanation so submitted as everything is flowing from the registered sale deed where transactions have been duly documented including the payment through demand draft and cash which is from the known sources of funds contributed by the assessee’s husband.

We therefore find that the assessee has offered reasonable explanation justifying the cash transactions and thus, in the entirety of facts and circumstances of the case and considering various decisions cited at the Bar which also support the case of the assessee

we are of the considered view that the assessee doesn’t deserve to be punished by way of levy of penalty u/s 271D for receiving money from her husband for purchase of family property and hence, the same is directed to be deleted.