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आदेश/Order
Per Sanjay Garg, Judicial Member: The captioned appeals have been preferred by the assessee against the separate orders dated 2.2.2017 of the Commissioner of Income Tax (Appeals), Karnal [hereinafter referred to as ‘CIT(A)’]. The
common grounds raised by the assessee in both the appeals reads as under:-
ITA Nos. 687 & 688-chd-2019 Shri Sukhwinder Singh, Kurukshetra 2 i) That the CIT (A) has erred in confirming the penalty levied by A.O by presuming or assuming or dreaming the lapse which infact was not.
ii) That the CIT (A) has erred in confirming his action of imposing the penalty irrespective of his admission in assessment order, he assessed the case on the basis of audit-report on records.
iii) That the CIT (A) further erred in confirming the penalty despite the fact, neither the audit-report was prepared after the due date nor non-submission during assessment proceedings.
iv) That the appellant craves the right to add, delete or alter any of the Grounds before or at the time of hearing of appeal.
Since the facts and issue involved in both the appeals are
identical, hence, they were heard together and are being disposed of by
this common order.
In these appeals, the assessee has agitated the levy of penalty u/s
271B of the Income Tax Act, 1961 (in short 'the Act') of Rs. 1 lac for
each of the assessment year.
The brief facts of the case are that the assessee along with return
of income also filed a statutory audit report. However, during the
assessment proceedings, the Assessing Officer found that the audit
report attached was unsigned. When confronted, the assessee in this
respect has filed a duly signed audit report; however, the Assessing
Officer noticed that there was a mismatch of certain figures in the
ITA Nos. 687 & 688-chd-2019 Shri Sukhwinder Singh, Kurukshetra 3 second report as compared to the first unsigned audit report. The
Assessing Officer, therefore, observed that there was no justification for
the assessee to file an unsigned audit report, the figures of which did not
match with the audit report filed during the assessment proceedings. The
Assessing Officer, therefore, concluded that the audited balance sheet
was not available with the assessee on 30.9.2009 and at the time of the
filing of the original return of income.
Before the Ld. CIT(A), the assessee explained that though audit
report was duly filed along with return of income, however, since there
were certain typing mistakes in the audit report, the same were rectified
by the Chartered Accountant and accordingly the net profit was revised
to Rs. 34,63,410/- as compared to the earlier net profit of Rs.
24,18,840/-. It was also pleaded that since the accounts were audited
within the prescribed time, there was no violation which warrants the
imposition of penalty u/s 271B of the Act. However, the Ld. CIT(A) did
not get satisfied by the above contention raised by the assessee. He,
therefore, confirmed the penalty so levied by the Assessing Officer.
Being aggrieved by the above order of the CIT(A), the assessee
has come in appeal before us.
A perusal of the record reveals that it is not a case where the
assessee had not filed any audit report alongwith return of income.
However, since certain discrepancies were found by the Assessing
ITA Nos. 687 & 688-chd-2019 Shri Sukhwinder Singh, Kurukshetra 4 Officer in the audit report field with the return of income, hence, the
assessee filed revised audit report from the Chartered Accountant. The
facts in this case reveal that it is not a case of default on the part of the
assessee, rather, there seems certain lapses on the part of the concerned
auditor of the assessee. However, the discrepancies in the audit report
occurred due to typographical error were rectified by filing of the
second report and accordingly the income of the assessee has been
assessed u/s 143(3) of the Act. In our view, the default on the part of
the assessee in this case falls within exception of reasonable cause as
provided u/s 273B of the Act.
In view of this, we do not find any justification on the part of the
lower authorities in imposing the impugned penalty, the same is
accordingly ordered to be deleted.
In the result, both the appeals of the assessee are hereby allowed.
Order dictated and pronounced in the Open Court immediately on
completion of hearing.
Sd/- Sd/- (अ�नपूणा� गु�ता / ANNAPURNA GUPTA) (संजय गग� / SANJAY GARG) लेखा सद�य/ Accountant Member �या�यक सद�य/ Judicial Member Dated : 26.11.2019 “आर.के.”
ITA Nos. 687 & 688-chd-2019 Shri Sukhwinder Singh, Kurukshetra 5 आदेश क� ��त�ल�प अ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकर आयु�त/ CIT 4. आयकर आयु�त (अपील)/ The CIT(A) 5. �वभागीय ��त�न�ध, आयकर अपील�य आ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड� फाईल/ Guard File
आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar