SAYEGH PAINT FACTORIES INDIA PRIVATE LIMITED,ERNAKULAM vs. CORPORATE CIR 2(1), KOCHI

ITA 451/COCH/2025Status: DisposedITAT Cochin30 October 2025AY 2019-20Bench: SHRI INTURI RAMA RAO (Accountant Member), SHRI SOUNDARARAJAN K. (Judicial Member)1 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the delay in filing the audit report was due to genuine reasons beyond the company's control, stemming from internal disputes and NCLT proceedings, which qualifies for reasonable cause under Section 273B. The Tribunal noted that the Principal Commissioner of Income Tax (PCIT) had condoned the delay in filing the return. Given the PCIT's condonation and the reasonable cause for the delay, imposing a penalty under Section 271B was deemed not fit.

What were the facts?

The assessee, a subsidiary of National Paints Holdings Ltd., faced internal disputes among directors, preventing the convening of its Annual General Meeting (AGM). Consequently, audited financial statements, Director's Report, and Auditor's Report could not be presented and approved, leading to a delay in filing the Income Tax Return and the tax audit report under Section 44AB for AY 2019-20. The delay was further compounded by ongoing litigation with the National Company Law Tribunal (NCLT).

What were the issues?

Whether the penalty under Section 271B for delay in filing the tax audit report is leviable when the delay was due to internal disputes and the PCIT had condoned the delay in filing the return.

Which sections of the Income-tax Act were involved?

Section 271B,Section 44AB,Section 273B,Section 148,Section 119(2)(b),Section 144B(6)(vii)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, COCHIN BENCH : COCHIN

Before: SHRI INTURI RAMA RAO & SHRI SOUNDARARAJAN K.

For Respondent: Smt. Leena Lal, Snr.AR

Heard together (2 matters)

S.A. No. 69/Coch/2025
ITA No. 451/Coch/2025

Read from the judgment's own cause title. This page is filed under one of them.

PER SOUNDARARAJAN K., JUDICIAL MEMBER

This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 15/05/2025 in respect of the A.Y. 2019-20 and raised the following grounds: S.A. No. 69/Coch/2025 & Tax effect relating to each Grounds of Appeal ground of appeal (see note below) III. Legal pronouncements 12- The Honourable Chennai in the case of M/s Encore Construction- Consortium Pvt Ltd Vs ITO (ITAT Chennai) held that delay in filing of tax audit 1 Rs 0 report due to dispute between the directors of the assessee company is just a technical breach without any malafide intention. Hence, penalty u

The order continues below.

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