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Income Tax Appellate Tribunal, ‘A’ BENCH, KOLKATA
Before: Shri Rajpal Yadav, Vice-(KZ) & Shri Rajesh Kumar
Per Rajpal Yadav, Vice-President (KZ):- ITA No. 204/KOL/2022: The present appeal is directed at the instance of assssee against the order of ld. Commissioner of Income Tax (Appeals), National 1
ITA Nos. 204 & 205/KOL/2022 Assessment Year: 2015-2016 Burdwan Cooperative Agriculture And Rural Development Bank Limited Faceless Appeal Centre (NFAC), Delhi dated 10.03.2022 passed for assessment year 2015-16.
The solitary grievance of the assessee is that the ld. CIT(Appeals) has erred in confirming the penalty of Rs.1,50,000/- imposed by the ld. Assessing Officer under section 271B of the Income Tax Act for not filing the statutory audit report under section 44AB within the due date. In order to explain the lapse at the end of the assessee apart from apprising us with the report, ld. Counsel for the assessee has filed an affidavit of Shri Samir Kumar Ghosh, Chief Executive Officer of the assessee-Cooperative Society. The affidavit reads as under:- “FOR CONDONATION OF DELAY IN FILING TAX AUDIT REPORT U/S 44AB AND RETURN OF INCOME Before the Income Tax Appellate Tribunal Kolkata; A Bench In the matter of Burdwan Co Operative Agriculture & Rural Development Bank Ltd having PAN- AACAB0468Q; Assessment Year: 2015-16- Affidavit of Mr. Samir Kumar Ghosh, Chief Executive Officer, Burdwan Co Operative Agriculture & Rural Development Bank Ltd aged 58 years That I, the above named deponent, am well conversant with the facts deposed below:- (1) That the Statutory Audit of Burdwan Co-operative Agriculture & Rural Development Bank Ltd for year ended 31st March, 2015 was completed on 29.03.2016 by the Auditors appointed by the Director of Cooperative Audit, Govt of West Bengal and that the Auditors' Report was handed over a few months thereafter.
ITA Nos. 204 & 205/KOL/2022 Assessment Year: 2015-2016 Burdwan Cooperative Agriculture And Rural Development Bank Limited (2) That the "Specified date" as referred to in sec 44 AB i.e. 30.09.2015 for filing of Tax Audit Report had expired due to reasons beyond the control of the Society. (3) That the Tax Audit related task was taken up after receipt of Statutory Auditor Report but could not be completed due to our inability to provide suitable and necessary clarifications to the Tax Auditor on time. (4) That Superannuation of 2 key officials of the accounts department of the Society viz. Smt. Bandana Banerjee, Accountant in October, 2016 and that of Sri Jayanta Kumar Dutta, Manager (System & Finance) in January 2017 further prevented the Society from providing timely clarification to the Tax Auditor. (5) That as it was already the month of September, 2016, the Tax Auditor got preoccupied with time bound work pertaining to the following assessment year i.e. 2016- 17. (6) That the society and the tax auditor together ultimately ensured that the Tax Audit Report and the return of income was filed before expiry of the final deadline, i.e. 31.03.2017 as permissible vide sec. 139(4) of the I.T. Act, 1961. (7) That this delay having taken place unintentionally and I having been prevented by sufficient and reasonable cause in filing Tax Audit Reprt and the return of income within time. On the above facts, there was no malafide intention behind not having filed the Tax Audit Report and the return of income within the prescribed time. Sd/- (Samir Kumar Ghosh) Deponent Signed at Burdwan, this 7th day of July, 2022, Verification I Samir kumar Ghosh, Chief Executive Officer, Burdwan Cooperative Agriculture & Rural Development Bank Ltd., the above named deponent do hereby verify on oath that the contents of the affidavit above are true to my personal knowledge and nothing material has been concealed or falsely
ITA Nos. 204 & 205/KOL/2022 Assessment Year: 2015-2016 Burdwan Cooperative Agriculture And Rural Development Bank Limited stated. Verified at Burdwan, this 7th day of July 2022. Sd/- (Samir Kumar Ghosh) Deponent”
On the other hand, ld. D.R. submitted that the explanation given by the assessee is that its accounts could not be audited by the auditors appointed by the Director of Cooperative Audit, Government of West Bengal and, therefore, it could not finalize its accounts. According to the ld. D.R., this is the additional requirement for conducting cooperative business but for the purpose of Income Tax Act, the assessee should have separately audited its accounts and submitted the documents within the due date. Under the garb of non- completion of the audit by the statutory auditors appointed by the West Bengal Government, the assessee cannot plead that it will not file the audited accounts for the purpose of Income Tax Act.
We have duly considered the rival contentions and perused the record. No doubt, there is a lapse at the end of assessee for not finalize its accounts audited within the statutory period of time. The audit of the assessee for the year ending on 31.03.2015 was audited by the Statutory Auditors appointed by the Director of Cooperative Audit, Government of West Bengal on 29.03.2016. Had the assessee prepared its accounts separately for the purpose of Income Tax Act, then, 4
ITA Nos. 204 & 205/KOL/2022 Assessment Year: 2015-2016 Burdwan Cooperative Agriculture And Rural Development Bank Limited chance of contradiction would crept in the accounts. In order to avoid, the assessee might have waited for the completion of the audited accounts by statutory auditor appointed by the Government of West Bengal. Being a Cooperative Society, it is dependent on conduct of its certain statutory requirements under the guidance of the Registered Cooperative Society, West Bengal and the Executive Officer might have thought it proper that unless those accounts are completed, it should not prepare for the purpose of income tax. It can be a benefit at the end of the assessee-society for not getting the accounts audited as required under section 44AB. Therefore, in our view, the assessee does not deserve with the penalty. We allow the appeal of the assessee and delete the penalty.
As far as ITA No. 205/KOL/2022 is concerned, it is an appeal at the instance of assessee impugning the order of ld. CIT(Appeals) for confirming the penalty of Rs.5,000/- for late uploading of the audit report. The assessee has been visited with penalty under section 271F. Since we have deleted the penalty imposed for non- completion of the statutory audit within the due date of filing under section 44AB, we construe it as sufficient reason for not uploading of the report alongwith the completed accounts. Therefore, this penalty also stands deleted. The appeal of the assessee is allowed.
ITA Nos. 204 & 205/KOL/2022 Assessment Year: 2015-2016 Burdwan Cooperative Agriculture And Rural Development Bank Limited
In the result, both the appeals of the assessee are allowed. Order pronounced in the open Court on December 20th, 2022. Sd/- Sd/- (Rajesh Kumar) (Rajpal Yadav) Accountant Member Vice-President (KZ) Kolkata, the 20th day of December, 2022
Copies to :(1) Burdwan Cooperative Agriculture And Rural Development Bank Limited, Old Court Compound, Burdwan-713101, W.B.
(2) Income Tax Officer, Ward-1(1), Burdwan, Aayakar Bhawan, Court Compound, Burdwan-713101 (3) Commissioner of Income Tax (Appeals), NFAC, Delhi; (4) Commissioner of Income Tax- ; (5) The Departmental Representative (6) Guard File TRUE COPY By order
Assistant Registrar, Income Tax Appellate Tribunal, Kolkata Benches, Kolkata Laha/Sr. P.S.