AMOL SHRIDHAR CHOUGULE,SHIROL vs. ITO, WARD 1, ICHALKARANJI, ICHALKARANJI

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ITA 387/PUN/2026Status: DisposedITAT Pune02 September 2026AY 2017-183 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessee's income was solely commission-based and did not exceed the threshold limit for mandatory audit under Section 44AB. Therefore, the penalty levied under Section 271B was erroneous.

What were the facts?

The assessee, an individual engaged in the business of distributing recharge vouchers, declared a certain income. The Assessing Officer initiated penalty proceedings under Section 271B for not getting the books of account audited, believing the turnover exceeded the limit prescribed under Section 44AB.

What were the issues?

Whether the assessee was required to get its books of account audited under Section 44AB, and consequently, whether the penalty under Section 271B was rightly imposed.

Which sections of the Income-tax Act were involved?

Section 271B,Section 44AB,Section 143(3),Section 194H

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCHES “A”, PUNE

Before: DR. MANISH BORAD & SHRI PAVAN KUMAR GADALE

For Appellant: Shri Bhuvnesh Kankani
For Respondent: Shri Rajesh Haladkar
Hearing: 27.07.2026Pronounced: 02.09.2026

PER DR. MANISH BORAD, ACCOUNTANT MEMBER : The captioned appeal at the instance of assessee pertaining to A.Y.2017-18 is against the order dated 13.11.2025 framed by National Faceless Appeal Centre, Delhi passed u/s.250 of the Income Tax Act, 1961 (in short ‘the Act) arising out of Penalty order dated 25.01.2022 passed u/s.271B of the Act.

2.

The only grievance of the assessee is that ld.CIT(A) erred in confirming the penalty levied by the Assessing Officer u/s.271B of the Act at Rs.1.50 lakh for not getting the books of account audited.

3.

We have heard the rival submissions and perused the record placed before us. We observe that the assessee is an

ITA No.387/PUN/2026 Amol Shridhar Chougule individual and engaged in the business as Super Distributor of Vodafone-Idea Cellular Limited (in short ‘Vodafone’) and carried out business of purchase and sale of recharge vouchers. Total income of Rs.2,69,420/- declared in the income tax return for A.Y. 2017-18 on 31.03.2018 and the said return was selected for scrutiny assessment u/s.143(3) of the Act completed on 13.11.2019 accepting the returned income. However, ld. Assessing Officer on observing that the transactions appearing in the bank statements indicate that the turnover of the assessee exceeds the limit prescribed u/s.44AB of the Act, therefore the assessee is required to get the books of account audited u/s.44AB of the Act and in absence thereof initiated penalty proceedings u/s.271B of the Act and levied the penalty at Rs.1.50 lakh. Assessee subsequently failed to get any relief in the appeal before the ld.CIT(A).

4.

We have gone through the record and observe that the assessee is operating as Distributor for Vodafone on commission basis and further Form 26AS of the assessee clearly indicates that Vodafone Ltd. has deducted TDS u/s.194H of the Act, i.e. tax deducted at source on commission paid to the assessee. Admittedly, bank account of the assessee contains the transactions of making payment for getting recharge vouchers from the company and then giving it to the customers. However, they are not entered in the books of accounts as purchases and sales and only the commission received on transaction are accounted for. Assessee under a Bonafide belief and on the advice of the Tax Consultant treated the commission income as its turnover and did not get the books of account audited. We find that the assessee has only earned commission income from Vodafone Ltd. and therefore in

ITA No.387/PUN/2026 Amol Shridhar Chougule our considered view the total turnover of the assessee is the commission income for the year under appeal which is not exceeding threshold limit prescribed u/s.44AB of the Act. Therefore, the assessee is not required to get the books of account audited. Under these given facts and circumstances, ld. Assessing Officer grossly erred in levying penalty u/s.271B of the Act at Rs.1.50 lakh. Finding of ld.CIT(A) is set aside and the impugned penalty of Rs.1.50 lakh is deleted. Grounds of appeal raised by the assessee are allowed.

5.

In the result, the appeal of the assessee is allowed.

Order pronounced on this 02nd day of September, 2026.

Sd/- Sd/- (PAVAN KUMAR GADALE) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; दिन ांक / Dated : 02nd September, 2026. Satish Satish Kumar Digitally signed by Satish Kumar Madishetty Madishetty Date: 2026.09.02 15:04:44 +05'30' आदेश की प्रतिलिपि अग्रेपिि / Copy of the Order forwarded to : अपील र्थी / The Appellant. 1. प्रत्यर्थी / The Respondent. 2. 3. The Pr. CIT concerned. विभ गीय प्रतितनधि, आयकर अपीलीय अधिकरण, “A” बेंच, 4. पुणे / DR, ITAT, “A” Bench, Pune. ग र्ड फ़ इल / Guard File. 5. आिेश नुस र / BY ORDER,

// True Copy // Assistant Registrar, आयकर अपीलीय अधिकरण, पुणे / ITAT, Pune.

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