ELANTHOOR SERVICE CO OPERATIVE BANK LIMITED,ELANTHOOR V. COMMISSIONER OF INCOME TAX APPEALS, NORTH BLOCK

ITA 589/COCH/2024

AI Insights

The case revolves around a penalty imposed by the Income Tax Officer, Ward-2, Thiruvalla, on Elanthoor Service Co-op. Bank Ltd. for not furnishing the audited financial statements within the due date as specified under section 44AB of the Income Tax Act, 1961. The penalty of Rs. 95,430 was confirmed by the CIT(A) but was contested by the appellant before the Income Tax Appellate Tribunal. The appellant argued that the delay was due to the procedural requirements under the Kerala Cooperative Societies Act, which was accepted as a reasonable cause by the Tribunal, leading to the deletion of the penalty.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 474727 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• 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: T.T. BIJU
• Keywords: Reasonable cause
• Section: 44AB; 271B

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH BEFORE SHRI INTURI RAMA RAO, AM AND SHRI PRAKASH CHAND YADAV, JM ITA No. 589/Coch/2024 Assessment Year: 2017-18 Elanthoor Service Co-op. Bank Ltd. .......... Appellant Elanthoor P.O., Pathanamthitta 689643 [PAN: AAAAE1867C] Vs. The Income Tax Officer .......... Respondent Ward - 2, Thiruvalla Appellant by: Shri T.T. Biju, Advocate Respondent by: Smt. Leena Lal, Sr. D.R. Date of Hearing: 17.12.2024 Date of Pronouncement: 21.01.2025 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 24.04.2024 for Assessment Year (AY) 2017-18. 2. The only issue raised by the assessee is that the learned CIT(A) erred in confirming the penalty levied by the Income Tax Officer, Ward- 2, Thiruvalla (hereafter “the AO”) u/s 271B of the Income Tax Act, 1961 (the Act) amounting to Rs.95,430/-. 3. In the present case, the audited financial statements were not furnished by the assessee within the due date as specified u/s 44AB of the 2 ITA No. 589/Coch/2024 Elanthoor Service Co-op. Bank Ltd. Act. Therefore, the AO levied penalty u/s 271B of the Act amounting to Rs. 95,430/- . 4. Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order confirmed the action of the AO. 5. Being aggrieved by the order of the learned CIT(A) the assessee is in appeal before us. 6. The learned A.R. before us submitted that the delay in getting the accounts audited and consequently furnishing the tax audit report belatedly was on account of the delay in getting the accounts audited and obtaining the audit certificate under the Kerala Cooperative Societies Act. Thus, it was pleaded by the learned counsel for the assessee that there was sufficient cause for the delay in getting the account audited and consequently furnishing the audit report belatedly. As such the learned A.R. prayed for wavier of the penalty under the provisions of section 273B of the Act. 7. On the other hand, the learned Sr. DR vehemently supported the orders of the authorities below. 8. 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: - “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 3 ITA No. 589/Coch/2024 Elanthoor Service Co-op. Bank Ltd. 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.” 9. 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. 10. In the result, appeal filed by the assessee is allowed. 11. Order pronounced in the open court on 21st January, 2025. Sd/- Sd/- (PRAKASH CHAND YADAV) JUDICIAL MEMBER (INTURI RAMA RAO) ACCOUNTANT MEMBER Cochin, Dated: 21st January, 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 By Order Assistant Registrar ITAT, Cochin "