ROHAN VASANT KALE,NASHIK vs. ITO WARD 1 NASHIK, NASHIK

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ITA 3/PUN/2024Status: DisposedITAT Pune13 March 2024AY 2017-78Bench: SHRI S.S. GODARA (Judicial Member), SHRI INTURI RAMA RAO (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 while a penalty is leviable for delayed filing of the Tax Audit Report, no prejudice was caused to the Revenue due to the delay. Therefore, it was not a fit case for levying the penalty.

What were the facts?

The assessee failed to get their accounts audited as required by Section 44AB of the Income Tax Act for AY 2017-18. The Tax Audit Report was submitted late, on 04.10.2018, after the assessment order was passed on 12.12.2019. The Assessing Officer levied a penalty of Rs. 1,50,000/- under Section 271B.

What were the issues?

Whether the penalty under Section 271B for delayed submission of the Tax Audit Report is justified when no prejudice is caused to the revenue.

Which sections of the Income-tax Act were involved?

Section 44AB,Section 271B,Section 274

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, PUNE

Before: SHRI S.S. GODARA & SHRI INTURI RAMA RAO

For Appellant: Shri Ashish Mahendra Bhalgat
For Respondent: Shri Sourabh Nayak

आदेश / ORDER

PER INTURI RAMA RAO, AM:

1.

This is an appeal filed by the appellant directed against the order of National Faceless Appeal Centre (NFAC), Delhi, dated 31.10.2023 passed u/s 250 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) confirming the levy of penalty of Rs.1,50,000/- u/s.271B of the Act.

2.

Briefly, the facts of the case are that the appellant is an individual deriving income from supply of dental material and equipment. Return of income for the A.Y. 2017-18 was filed on 19.09.2019. Against the said return of income, the assessment was completed u/s.144 of the Act vide order dt. 12.12.2019. After completion of the assessment proceedings, the AO had issued show cause notice u/s.274 r.w.s.271 of the Act for failure of the assessee to get the accounted audited u/s.44AB of the Act as stipulated under the provisions of the Act. It was submitted that the Tax Audit Report was submitted on 04.10.2018 and the delay had occurred as the appellant underwent surgery in the month of October, 2017. However, rejecting the explanation of the appellant, the AO vide penalty order dt.11.02.2021 levied penalty of Rs.1,50,000/- u/s.271B of the Act. Even on appeal, the ld. CIT(A) confirmed the penalty levied by the Assessing Officer.

3.

Being aggrieved by the order of CIT(A), the appellant is in appeal before the Tribunal.

4.

We heard the rival submissions and perused the relevant material on record. The issue in the present appeal is whether or not the AO was justified in levying penalty of Rs.1,50,000/- u/s.271B of the Act. It is an admitted fact that the Tax Audit Report was submitted on 04.10.2018 much before the completion of assessment, i.e. 12.12.2019. No doubt the penalty is leviable under the provisions of section 271B even for the delay in filing the Tax Audit Report. Without going into the explanation given by the assessee, we are of the considered opinion that no prejudice was caused to the Revenue on account of delay in submission of Tax Audit Report.

Therefore, it is not a fit case for levy of penalty u/s.271B of the Act.

Accordingly, we direct the AO to delete the penalty of Rs.1,50,000/-.

5.

In the result, the appeal of the appellant is allowed.

Order pronounced in the open court on 13th March, 2024.

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