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Income Tax Appellate Tribunal, “H” BENCH, MUMBAI
Before: SHRI SAKTIJIT DEY, JM & SHRI MANOJ KUMAR AGGARWAL, AM
सुनवाई की िायीख / : 27/10/2016 Date of Hearing घोषणा की िायीख / : 11/11/2016 Date of Pronouncement आदेश / O R D E R Per Manoj Kumar Aggarwal (Accountant Member)
The captioned appeal by assessee for Assessment Year [AY] 2007-08 is directed against the order of Commissioner of Income Tax (Appeals)- 33 [CIT(A)], Mumbai dated 10/12/2014, which in turn arises out of an order passed by Assessing Subhash Bhaskar Utturkar Assessment Year 2007-2008 Officer [AO] under Section 271B of the Income Tax Act, 1961 [in short ‘the Act’] dated 11/04/2012.
The only issue in this appeal is with regard to penalty imposed under Section 271B of the Act for Rs.1.00 Lacs for the failure to get the accounts audited in terms of Section 44AB of the Act. 3. Undisputed facts Qua the dispute are that the assessee is a resident individual who filed its Return of Income belatedly on 31/03/2008 for impugned AY declaring total income of Rs. 1,85,690/- and claimed set-off of ‘Capital Gains’ carried forward loss of Rs.4,41,281/-. The return was processed u/s 143(1). Subsequently, the case was re-opened u/s 147 as return was filed beyond due date and accordingly set-off of brought forward losses was not allowed to the assessee. Further, the assessee carried out share transactions during the year and offered the same under the head ‘Capital Gains’ but after considering the nature of transactions carried out by assessee, AO treated the same to be taxable under the head ‘Business Income’. Consequently as turnover of the assessee exceeded the limit specified in Section 44AB of the act and since the assessee failed to get the accounts audited, an amount of Rs. 1.00 Lacs was imposed as penalty u/s 271B vide penalty order dated 11/04/2012. The same was upheld by First Appellate Authority, against which the assessee is in appeal before us. 4. At the outset, Ld. Counsel for Assessee pointed out that similar penalty was imposed in similar circumstances for AY 2008-2009 in assessee’s own case but the same has been deleted by Tribunal vide ITA N.1365/Mum/2015 dated 17/08/2016, a copy of which has been placed before us. Upon perusal, we find the Tribunal has made following observations in assessee’s own case for AY 2008-2009:- “We have carefully considered the rival submissions. In the present case, it is quite evident that assessee is not maintaining any books of account. Ostensibly, the failure to maintain books of account can lead to levy of penalty under section 271A of the Act and penalty under section 271B of the Act cannot be levied for failure to maintain books of account. The aforesaid proposition has been laid down by the Hon’ble Gauhati High Court in the case of Surajmal Parsuram Todi vs CIT, 222 ITR 691 (Gau)
Subhash Bhaskar Utturkar Assessment Year 2007-2008 and in our view the facts of the present case are fully covered by the said judgment. Accordingly, we set-aside the order of the CIT(A) and direct the Assessing Officer to delete the penalty of Rs. 1.00 lacs imposed under section 271B of the Act”.