AMBALAPAD SERVICE CO OPERATIVE BANK LTD NO 759,KUNDUKAD, THRISSUR V. INCOME TAX OFFICER, THRISSUR

ITA 78/COCH/2025

AI Insights

The case involves Ambalapad Service Co-op. Bank Ltd., the appellant, contesting a penalty imposed by the Income Tax Officer, Ward 2(1), Thrissur, for the delayed submission of an audit report as mandated under section 44AB of the Income Tax Act, 1961. The appellant, a co-operative society, had not filed a regular return of income initially and upon receiving a notice under section 148, filed a return along with a delayed audit report. The Income Tax Officer assessed the income and imposed a penalty for the late submission of the audit report, which was upheld by the CIT(A). The Tribunal, referencing a similar case by the Kerala High Court, found that the delay was due to reasonable cause and thus deleted the penalty.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 668816 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Other Referred Cases: Chavakkad Service Co-op. Bank Ltd. [2024] 169 taxmann.com 45 (Kerala)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LEENA LAL
• Assessee Lawyers: RAMDAS M.
• Keywords: Reasonable cause
• Section: 148; 143(3)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH BEFORE SHRI INTURI RAMA RAO, AM AND SHRI PRAKASH CHAND YADAV, JM ITA No. 78/Coch/2025 Assessment Year: 2012-13 Ambalapad Service Co-op. Bank Ltd. .......... Appellant XI/57, Kundukad P.O., Thrissur 680028 [PAN: AADAA9298G] vs. The Income Tax Officer, Ward 2(1), Thrissur .......... Respondent Appellant by: Shri Ramdas M., CA Respondent by: Smt. Leena Lal, Sr. D.R. Date of Hearing: 28.05.2025 Date of Pronouncement: 23.06.2025 O R D E R Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)] dated 03.12.2024 for Assessment Year (AY) 2012-13. 2. Brief facts of the case are that the appellant is a co-operative society registered under the Kerala State Co-operative Societies Act, 1969. It is classified as primary agricultural co-operative society. The appellant had not filed regular return of income under the provisions of section 139(1) of the Income Tax Act, 1961 (the Act). The Income 2 ITA No. 78/Coch/2025 Ambalapad Service Co-op. Bank Ltd. Tax Officer, Ward-2(1), Thrissur (hereinafter called \"the AO\") formed an opinion that income escaped assessment to tax. Accordingly, a notice u/s. 148 of the Act was issued to the appellant. In response to the notice u/s. 148 the appellant filed return of income. The prescribed audit report u/s. 44AB of the Act was filed manually in August, 2019. Against the said return of income, the assessment was completed by the AO vide order dated 03.12.2019 passed u/s. 143(3) r.w.s. 147 of the Act at a total income of Rs. 62,73,440/-. It s stated that the delay in submitting the audit report was on account of delay in conducting the audit under the Co-operative Societies Act. The audit report under the Co-operative societies Act was received only on 04.11.2013. However, the AO was of the opinion that the appellant had failed to submit the audit report before the due date. Therefore, he proceeded to with levy of penalty of Rs. 1,50,000/- u/s. 271B of the Act vide order dated 12.01.2021. 3. Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order confirmed the action of the AO. 4. Being aggrieved, the appellant is in appeal before this Tribunal in the present appeal. 5. We have heard the rival contentions of both the parties and perused the materials available on record. At the outset, we note that the Hon'ble Jurisdictional High Court in the case of Chavakkad Service Co-op. Bank Ltd. [2024] 169 taxmann.com 45 (Kerala) has observed as under: - 3 ITA No. 78/Coch/2025 Ambalapad Service Co-op. Bank Ltd. “Where assessee co-operative societies did not file audit report as mandated under section 44AB within time limit specified thereunder, however, audit reports were made available before Assessing Authority at time of finalization of assessments, since delay in obtaining audit reports from statutory auditors under Kerala Co-operative Societies Act and Rules could be seen as a reasonable cause for delayed submission of audit reports, no penalty under section 271B was to be imposed on assessee.” 6. The facts of the case on hand are identical as discussed above. Thus, respectfully following the same, we delete the penalty imposed by the Revenue. 7. In the result, appeal filed by the assessee is allowed. Order pronounced in the open court on 23rd June, 2025. Sd/- Sd/- (PRAKASH CHAND YADAV) JUDICIAL MEMBER (INTURI RAMA RAO) ACCOUNTANT MEMBER Cochin, Dated: 23rd June, 2025 n.p. Copy to: 1. The Appellant 2. The Respondent 3. The Pr. CIT concerned 4. The Sr. DR, ITAT, Cochin 5. Guard File Assistant Registrar ITAT, Cochin "