GALLUP TRADING P.LTD,MUMBAI vs. ITO 7(1)(1), MUMBAI

At the time of hearing, it was noticed that none appeared on behalf of the appellant-assessee inspite of service of notice by RPAD. On the other hand, the ld. DR appeared on behalf of the Revenue.

Accordingly, in view of Rule 24 of the Income Tax (Appellate Tribunal) Rules, 1963, the appeal of the assessee is being disposed off ex-parte the appellant-assessee after hearing the respondent-Revenue on merits.

In brief, the relevant facts are that the Assessing Officer noted that for Assessment Year 2009-10 assessee-company filed a return of income on 25.9.2009 declaring total income of Rs.26,080/-. In an assessment finalised u/s 144 r.w.s 147 of the Act on 30.3.2015, the total income was determined at Rs.39,48,744/- primarily on account of an addition of Rs.39,22,664/- on account of bogus purchases. In the order levying penalty u/s 271A of the Act, the Assessing Officer noted that during the assessment proceedings itself it was found that assessee was not maintaining any books of account. Further, in para 6 of the penalty order dated 18.9.2015, the Assessing Officer has reproduced the response of the assessee whereby it is admitted that necessary books of account were not maintained. Not finding any satisfactory explanation, the Assessing Officer imposed penalty of Rs.25,000/- u/s 271A of the Act for non-maintenance of account books. Even the CIT(A) has affirmed the levy of penalty.

The orders of the authorities below reveal that no credible explanation has been filed by the assessee for non-maintenance of books of account and, therefore, in our view, the penalty imposed u/s 271A of the Act of Rs.25,000/- is quite justified.

Insofar as levy of penalty u/s 271B of the Act is concerned, the same has been imposed by the Assessing Officer for the reason that assessee did not get his accounts audited in terms of Sec. 44AB of the Act. In our view, once there is a levy of penalty u/s 271A of the Act for non-maintenance of books of account, simultaneously there cannot be a levy of penalty separately u/s 271B of the Act for failure to get the accounts audited. As we have upheld the levy of penalty u/s 271A of the Act in the earlier paras, the penalty levied by the lower authorities u/s 271B of the Act is, therefore, directed to be deleted.

In the result, so far as appeal of the assessee in 271A of the Act is concerned, the same is dismissed whereas the appeal of assessee in pertaining to levy of penalty u/s 271B of the Act is allowed.