BALDEV SINGH,JASWAN KANGRA, HIMACHAL PRADESH vs. INCOME TAX OFFICER WARD, NURPUR, NURPUR, KANGRA

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ITA 276/CHANDI/2025Status: DisposedITAT Chandigarh18 August 2025AY 2017-18Bench: SHRI RAJPAL YADAV (Vice President), SHRI MANOJ KUMAR AGGARWAL (Accountant Member)3 pages

AI SummaryRemanded

Facts

The assessee challenged penalties of Rs.25,000 under Section 271A for non-maintenance of books of accounts and Rs.1,33,396 under Section 271B for failure to get accounts audited for AY 2017-18. The AO had made a best judgment assessment under Section 147 read with Section 144, noting the assessee's turnover exceeded Rs.1 Crore but books were not maintained as per Section 44AA. The CIT(A) had confirmed these penalties.

Held

The Tribunal observed that the underlying quantum assessment had been restored to the AO for fresh assessment by the first appellate authority. Recognizing that the outcome of the fresh quantum assessment would significantly impact the penalties, the Tribunal set aside the penalty orders and remanded the issue back to the AO for fresh consideration. The appeals were allowed for statistical purposes.

Key Issues

Whether penalties imposed under Section 271A and Section 271B for non-maintenance of books and failure to get accounts audited are sustainable when the original quantum assessment has been set aside and remanded to the AO for fresh consideration.

Sections Cited

147, 144, 44AA, 271A, 271B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, CHANDIGARH

Before: HON’BLE SHRI RAJPAL YADAV & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

(िनधा�रण वष� / Assessment Year: 2017-18) & 2. आयकरअपीलसं./ (िनधा�रण वष� / Assessment Year: 2017-18) Shri Baldev Singh ITO-Ward Nurpur बनाम/ Vs. Village Dadoa, Post Office Bari Near Chugan Baxar Tehsil Jaswan, Kangra (HP) 176501 Teshsil Nurpur (HP) -176202 �थायीलेखासं./जीआइआरसं./PAN/GIR No. BAAPS-3522-A (अपीलाथ�/Appellant) (��थ� / Respondent) : अपीलाथ�कीओरसे/ Appellant by S/Shri Ashok Goyal and Sifatpreet Singh (CAs) – : Ld. ARs ��थ�कीओरसे/Respondent by : Shri Vivek Vardhan (Addl. CIT) – Ld. Sr. DR सुनवाई की तारीख / Date of Hearing : 18-08-2025 घोषणा की तारीख / Date of Pronouncement : 18-08-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. In these twin appeals, the assessee assails levy of penalty of Rs.25,000/- u/s 271A and penalty of Rs.1,33,396/- u/s 271B of the Act for non-maintenance of books of accounts and failure to get the accounts audited respectively. The impugned orders have been passed by learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] both dated 31-01-2025. Having & 277/Chandi/2025 Assessment Year: 2017-18 heard rival submissions and upon perusal of case records, the appeals are disposed-off as under.

The assessee has been assessed for AY 2017-18 on best judgment basis u/s 147 r.w.s. 144 of the Act on 23-08-2021. The Ld. AO assessed income of Rs.10.40 Lacs. It was noted that the assessee’s turnover had exceeded Rs.1 Crores but the assessee did not maintain prescribe books of accounts as required u/s 44AA. Consequently, Ld. AO imposed impugned penalties u/s 271A and 271B for non-maintenance of books of accounts as well as for failure to get the accounts audited respectively. The Ld. CIT(A) confirmed both the penalties against which the assessee is in further appeal before us.

The Ld. AR advanced argument and stated that the assessee was running a milk-booth on commission basis. Therefore, only commission income would constitute turnover of the assessee. It has also been submitted that the quantum assessment has already been restored back by first appellate authority to Ld. AO for fresh assessment.