RIPALBHAI BHAGAVANJIBHAI MODI,BHATIYA vs. ADDITIONAL / JOINT / DEPUTY / ASSISTANT COMMISSIONER OF INCOME TAX, INCOME-TAX OFFICER, NFAC, DELHI

ITA 923/RJT/2026Status: DisposedITAT Rajkot19 August 2026AY 2017-186 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that penalty under Section 271B is not automatic and requires a failure to comply with Section 44AB. Since the audit report was obtained within the prescribed time and submitted during assessment proceedings, the penalty was not justified.

What were the facts?

The assessee, an individual, failed to file his return of income and was subsequently assessed under Section 147. The Assessing Officer initiated penalty proceedings under Section 271B for failure to get accounts audited, despite the assessee claiming the audit was completed and submitted.

What were the issues?

Whether penalty under Section 271B is leviable when the audit report was obtained within time and submitted during assessment proceedings, even if not filed with the return.

Which sections of the Income-tax Act were involved?

Section 271B,Section 44AB,Section 273B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC”

Before: Dr. Arjun Lal Saini

For Appellant: Shri Mahesh Paun, Ld. AR
For Respondent: Shri Shishir Kumar, Ld. Sr. DR
Hearing: 30/07/2026Pronounced: 19/08/2026

Per, Dr. Arjun Lal Saini, AM: Captioned appeal filed by the assessee, pertaining to assessment year (AY) 2017-18, is directed against the order passed under section 250 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) by the National Faceless Appeal Centre (NAC) Delhi/Commissioner of Income-tax (Appeals) [in short ‘NFAC/Ld.CIT(A)’], dated 23.04.2026, which in turn arises out of penalty order passed b

The order continues below.

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