“failure to get accounts audited”
The decision most relied on for failure to get accounts audited is Surajmal Parsuram Todi v. CIT (222 ITR 691), cited in 114 judgments on BharatTax.
Leading authorities on failure to get accounts audited
A penalty under Section 271B for failure to get accounts audited cannot be levied if a penalty under Section 271A has already been imposed for non-maintenance of books of account.
If a penalty is levied under Section 271A for failure to maintain books of account, then a separate penalty under Section 271B for failure to get accounts audited under Section 44AB cannot also be levied.
If an assessee has not maintained books of accounts, the question of getting those accounts audited under Section 44AB does not arise, and therefore, a penalty under Section 271B for failure to get accounts audited cannot be levied. Non-maintenance of books is separately punishable under Section 271A.
When an assessee fails to maintain books of account, resulting in a confirmed penalty under section 271A, no additional penalty under section 271B can be levied for the failure to get accounts audited under section 44AB, as there are no accounts to audit.
Books of account include electronic records and are maintained to provide credible financial data for tax returns and to determine income. Penalty under section 271B for not getting accounts audited is applicable only when accounts are maintained, whereas section 271A applies if no accounts are maintained at all.
