KMA CONSTRUCTIONS INDIA PVT LTD,KOZHIKODE vs. ITO CIRCLE 1(1) & TPS, KOZHIKODE

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ITA 149/COCH/2023Status: DisposedITAT Cochin25 September 2024AY 2016-17Bench: SHRI SATBEER SINGH GODARA (Judicial Member), SHRI AMARJIT SINGH (Accountant Member)3 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the delay in filing the tax audit reports, if explained with reasonable cause, can lead to the deletion of penalties under Section 273B. The change in auditor was considered a reasonable cause for the delay.

What were the facts?

The assessee filed its tax audit reports significantly late for assessment years 2015-2016 and 2016-2017, attributing the delay to a change in auditor. The lower authorities levied penalties for non-compliance with Section 44AB.

What were the issues?

Whether a change in auditor constitutes a reasonable cause for delay in filing the tax audit report, thereby warranting deletion of penalty under Section 271B read with Section 273B.

Which sections of the Income-tax Act were involved?

Section 44AB,Section 271B,Section 273B

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, COCHIN BENCH : COCHIN

Before: SHRI SATBEER SINGH GODARA & SHRI AMARJIT SINGH

Hearing: 21.08.2024Pronounced: 25.09.2024

PER BENCH : These assessee’s twin appeals I.T.A.Nos.148 & 149/ COCH./2023, arise against the National Faceless Appeal Centre [in short the “NFAC”] Delhi’s Din and Order No. ITBA/NFAC/S/250/2022-23/1045334225(1) and 1048110931(1), dated 09.09.2022 and 20.12.2022, for assessment years 2015- 2016 & 2016-2017, involving proceedings u/s. 271B of the Income Tax Act, 1961 (in short “the Act”); assessment year-wise, respectively.

1.

2 ITA.Nos.148 & 149/COCH./2023 Case called twice. None appears at assessee’s behest. It is accordingly proceeded ex-parte.

2.

Delay of 88 days in filing the instant appeal [ITA.No.148/Coch./2023] is condoned as per assessee’s solemn averments in light of Collector, Land Acquisition vs., MST Katiji [1987] 167 ITR 471 (SC) having settled the law long back that all such technical aspects must make a way for the cause of substantial justice.

3.

Learned DR submits that both the learned lower authorities have rightly levied the impugned penalties of Rs.1.5 lakh each in the impugned assessment years once the assessee could not substantiate the delay in filing of it’s concerned tax audit report. We note in this factual backdrop that even the learned Assessing Officer is fair enough in giving clear-cut finding that the due date of submitting the said tax audit report(s) are 31.10.2015 and 17.10.2016, whereas the assessee had placed it’s corresponding reports on record on 10.12.2015 and 06.12.2016; respectively. It had further explained before the learned lower authorities that the said delay of almost two months each was on account of the fact that there was change in the auditor for the purpose of finalising it’s tax audit reports. Be that as it may, we

3 ITA.Nos.148 & 149/COCH./2023 are of the considered view that once assessee is able to make-out it’s case attributing delay in compliance of 44AB provisions, the same forms reasonable cause u/sec.273B of the Act to delete the impugned penalty(ies). Ordered accordingly.

4.

These assessee’s twin appeals I.T.A.Nos.148 & 149/ COCH./2023 are allowed. A copy of this common order be placed in the respective case files. Order pronounced in the open Court on 25.09.2024.

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