MSE EMPLOYEES COOPERATIVE CREDIT SOCIETY LIMITED YAVATMAL,YAVATMAL vs. ITO WARD-1, YAVATMAL, YAVATMAL

ITA 673/NAG/2025Status: DisposedITAT Nagpur18 June 2026AY 2017-185 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the Assessing Officer (AO) failed to record satisfaction for initiating penalty proceedings under Section 271B in the assessment order. Therefore, the assumption of jurisdiction to initiate proceedings was vitiated.

What were the facts?

The assessee challenged a penalty levied under Section 271B for AY 2017-18. The penalty was initiated much later than the assessment order and the filing of the audit report.

What were the issues?

Whether penalty under Section 271B can be levied without the AO recording satisfaction in the assessment order. Whether there was substantial compliance with Section 44AB provisions.

Which sections of the Income-tax Act were involved?

Section 271B,Section 44AB,Section 80P(2)(a)(i)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, NAGPUR BENCH :: NAGPUR

For Appellant: Shri Mahavir Atal, CA &, Shri Ameenuddin Khan, Adv
For Respondent: Shri Surjit Kumar Saha, Sr.DR
Hearing: 16.06.2026Pronounced: 18.06.2026

PER ANUBHAV SHARMA, JM:

This appeal filed by the assessee is directed against the order of National Faceless Appeal Centre, Delhi, (for short, “CIT(A)”), dated 15/09/2025 passed under section 250 of the Income Tax Act, 1961 (for short, “Act”) which is emanating from the penalty order dated 30.03.2024 passed u/s. 271B of the Act, for the Assessment Year (AY) 2017-18. 2. On hearing both the sides, we find that impugned order of levy of penalty u/s. 271B of the Act has been challenged by the assessee by raising grounds primarily there was an inordinate delay in initiation of penalty as the assessment order was passed on 27.11.2019 and audit report was filed on 19.09.2008, while proceedings were initiated by notice

The order continues below.

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