Crossword Genius

Small deed visited by new penalty (8)

Ross

I believe the answer is:

sanction

'penalty' is the definition.
(thesaurus)

'small deed visited by new' is the wordplay.
'small' becomes 's' (abbreviation - e.g. clothes size).
'deed' becomes 'action' (I've seen this before**).
'visited by' means one lot of letters goes inside another.
'new' becomes 'n'.
'action' enclosing 'n' is 'anction'.
's'+'anction'='SANCTION'

(Other definitions for sanction that I've seen before include "Give official approval or attach a penalty to" , "Permission or approval as for course of action" , "measure taken against offending country?" , "Go-ahead" , "Penalty for breaking law" .)

I've seen this clue in The Times.
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