RAVI KANWAL NURSING HOME PVT. LTD.,BAREILLY vs. INCOME TAX OFFICER-2(3), BAREILLY

In this appeal the only ground taken by the assessee is the action of learned CIT(A) by which he has upheld the penalty imposed by the Assessing Officer u/s 271B of the Act.

Learned A. R. submitted that assessee is a private limited company which is engaged in running of a nursing home and Assessing Officer imposed the penalty u/s 271B of the Act by holding that the total receipts declared by the assessee exceeded the minimum amount which required the accounts to be audited u/s 44AB(a) of the Act. Learned A. R. in this respect submitted that assessee itself was not engaged in professional activities and rather it was running a business in the form of a private limited company therefore, the provisions of section 44AB(b) of the Act were applicable and the turnover limit for that year under consideration was Rs.60 lacs as against the turnover of Rs.54,45,940/- declared by the assessee. It was submitted that the authorities below have wrongly assumed that the assessee was engaged in professional activities whereas the company itself did not possess any professional qualification and therefore, the penalty should not have been levied.

Learned D. R., on the other hand, relied on the orders of the authorities below.

We have heard the rival parties and have gone through the material placed on record. We find that assessee is a private limited company which is engaged in providing medical facilities through engagement of professional doctors. The receipts of the assessee were Rs.54,45,940/-. The authorities below have held that this was the professional activity of the assessee and therefore, the assessee was liable to penalty for not getting its accounts audited as the turnover exceeded the limit mentioned in section 44AB(a) of the Act. However, we find that assessee itself did not possess any professional degree and rather it was engaged in commercial activities. There is difference between business and profession. For carrying on a profession, possession of some professional qualification is must. From the qualification we mean that there must be some special training of particular

In the result, the appeal of the assessee stands allowed.