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Income Tax Appellate Tribunal, JAIPUR BENCHES, JAIPUR
Before: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 534/JP/2018
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR Jh fot; ikWy jko] U;kf;d lnL; ,oa Jh foØe flag ;kno] ys[kk lnL; ds le{k BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 534/JP/2018 fu/kZkj.k o"kZ@Assessment Year : 2012-13 cuke M/s Rajasthan Rajya Vidyut DCIT, Vs. Utpadan Nigam Ltd., Vidyut Circle-06, Bhawan, Jan Path, Jyoti Nagar, Jaipur Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AABCR7436B vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri P. C. Parwal (CA) jktLo dh vksj ls@ Revenue by : Shri A. S. Nehara (JCIT) lquokbZ dh rkjh[k@ Date of Hearing : 09/08/2018 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 13/08/2018 vkns'k@ ORDER
PER: VIKRAM SINGH YADAV, A.M.
This is an appeal filed by the assessee against the order of ld. CIT(A)-2, Jaipur dated 30.01.2018 for Assessment Year 2012-13 wherein the assessee has challenged the confirmation of penalty of Rs. 1,50,000/- u/s 271B of the Act.
At the outset, the ld. AR submitted that the matter is squarely covered in assessee’s own case in ITA No. 100/JP/2018 dated 28.03.2018 for AY 2013-14 wherein this Bench has held that there exist a reasonable cause for the delay in completion and submission of the tax audit report and the penalty u/s 271B was deleted placing reliance on the decision of Hon’ble Punjab and Haryana High Court in case of CIT vs. Punjab State Leather Development Corporation Ltd. (2001) 119 Taxman 258.
ITA No. 534/JP/2018 M/s Rajasthan Rajya Vidyut Utpadan Nigam Ltd., Jaipur Vs DCIT, Jaipur
The relevant facts and findings in ITA No. 100/JP/2018 dated 28.03.2018 for AY 2013-14 are reproduced as under:-
“5. During the course of hearing, the ld. AR drawn a reference to the following table:-
Statement showing date of Statutory Audit, C&AG Audit, Tax Audit
FY AY Statutory C&AG Audit Tax Audit Date of filing of return/ Audit revised return 2010-11 2011-12 08.11.2012 22.04.2013 25.03.2013 27.09.2011/29.03.2013 2011-12 2012-13 28.11.2013 28.03.2014 26.03.2014 26.09.2012/29.03.2014 2012-13 2013-14 27.03.2014 19.08.2014 15.07.2014 27.09.2013/16.09.2014
The ld. AR, drawing our reference to above table, submitted that the delay in obtaining the tax audit report u/s 44AB is on account of delay in conducting the statutory audit/ C&AG audit because unless the statutory audit is conducted, tax audit report cannot be issued. The statutory audit was delayed in FY 2010-11 as even after all the efforts, the statutory audit report was issued by CR Mehta & Co. on 08.11.2012 and thereafter, C&AG made comments on the accounts on 22.04.2013. Thereafter, the statutory audit for FY 2011-12 could be started. The statutory audit report for FY 2011-12 was issued by P.C. Modi & Co. on 28.11.2013 and thereafter, C&AG made comments on the accounts on 28.03.2014. After this, the statutory audit report for FY 2012-13 was issued on 27.03.2014 and thereafter, C&AG made comments on the accounts on 19.08.2014. It is not the case of lower authorities that delay in the statutory audit is because of the fault of the assessee. Thus, delay in obtaining the tax audit report is because of a reasonable cause as envisaged u/s 273B and therefore, the penalty levied u/s 271B be deleted.
5.1 The Ld. CIT(A) has confirmed the levy of penalty only on the ground that the reasons forwarded by the assessee are not backed by evidence ignoring that all these dates are mentioned in the printed Balance Sheet 2
ITA No. 534/JP/2018 M/s Rajasthan Rajya Vidyut Utpadan Nigam Ltd., Jaipur Vs DCIT, Jaipur available on the record of AO. The further observation of Ld. CIT(A) that statutory auditor have not agreed to the audit fees and hence, there is a delay is not the claim of assessee as is evident from the submission extracted at Para 2.2 of the order. Thus, Ld. CIT(A) has confirmed the levy of penalty without application of mind.
5.2 The ld AR further placed reliance on the following cases:- • Hindustan Steel Ltd. Vs. State of Orissa 83 ITR 26 (SC) • CIT Vs. Punjab State Leather Development Corporation Ltd. (2001) 119 Taxman 258 (P&H) (HC) • APL India Pvt. Ltd. Vs. JCIT (2014) 62 SOT 91 (Mum.) (Trib.)
In view of above, it was submitted that the penalty imposed by AO and confirmed by Ld. CIT(A) be directed to be deleted.
We have heard the rival contentions and purused the material available on record. In the instant case, the limited issue for consideration is whether there is a reasonable cause for the delay in completing the tax audit and submitting the report of the tax auditor within the specified due date. Under section 273B, no penalty shall be imposable on the assessee for any failure which interalia include the defaults mentioned in section 271B, if the assessee proves that there was reasonable cause for the said failure. In the present case, the reason for the delay has been stated to be the delay in completing the statutory audit for the earlier years which has resulted in delay in completion of statutory audit for the year under consideration and the resultant delay in completing the tax audit and submitting the report thereof. It was submitted that without completing the statutory audit, the tax audit could not have been completed. We find that the statutory auditors are appointed by the Comptroller & Auditor General of India under section 619(2) of the Companies Act, 1956 and they have completed the statutory audit and 3
ITA No. 534/JP/2018 M/s Rajasthan Rajya Vidyut Utpadan Nigam Ltd., Jaipur Vs DCIT, Jaipur submitted their audit report dated 27.03.2014. Thereafter, the tax audit has been completed on 15.07.2014 and the revised return was filed on 16.9.2014. The Hon'ble Punjab & Haryana High Court in the case of CIT v. Punjab State Leather Development Corpn. Ltd. [2001] 119 Taxman 258 has held that delay in completion of statutory audit was a reasonable cause for non-compliance with section 44AB and it was held that the Tribunal was right in cancelling penalty levied under section 271B. Respectfully following the same, we are of the view that in the instant case, where there has been a delay in completion of statutory audit, there exist a reasonable cause for the delay in completion and submission of the tax audit report under section 44AB of the Act. The penalty levied under section 271B is therefore deleted.”
Following our earlier decision referred supra, there exist a reasonable cause for the delay in completion and submission of the tax audit report under section 44AB of the Act and the penalty levied u/s 271B of the Act is hereby deleted.
In the result, the appeal of the assessee is allowed.
Order pronounced in the open Court on 13/08/2018.
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vkns'kkuqlkj@ By order, सहायक पंजीकार@ Aेेपेजंदज. त्महपेजतंत.