Shri Avinash Narayan Butala, Ratnagiri V. ITO Wd. 3, Ratnagiri

ITA 1098/PUN/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7640 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-01-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 19-01-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 16-09-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ABHAY DAMLE
• Keywords: Reasonable cause

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDRAKUMAR YADAV AND SHRI D. KARUNAKARA RAO ITA NO. 1098/PN/09 (ASSTT. YEAR 2006-07) SHRI AVINASH NARAYAN BUTALA AT GUJAR LANE, TAL. KHED, DIST. RATNAGIRI PAN NO. AAXPB3182F .... APPELLANT VS. ITO WARD-3, RATNAGIRI . RESPONDENT APPELLANT BY : SHRI M.K. KULKARNI RESPONDENT BY : SHRI ABHAY DAMLE ORDER PER D. KARUNAKARA RAO AM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF THE CIT(A), KOLHAPUR DATED 08-07-2009 FOR THE A.Y 2006-07 AND TH E ONLY GROUND RAISED IS AS UNDER:- 1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW THE LD. CIT(A), KOLHAPUR WAS NOT JUSTIFIED IN D ISMISSING THE APPEAL OF THE APPELLANT CONFIRMING THE PENALTY LEVI ED U/S. 271-B OF THE ACT WITHOUT APPRECIATING THE PROVISIONS OF S ECTION 273-B AND THE REASONS FOR DELAY EXPLAINED AND DISMISSED O NLY ON TECHNICAL GROUNDS. THE PENALTY LEVIED BE QUASHED. 2. THIS IS THE CASE WHERE THE PENALTY WAS LEVIED U/S . 271B OF THE INCOME TAX ACT FOR FAILURE TO GET THE ACCOUNTS AUDITED AND FURNIS H A REPORT OF SUCH AUDIT AS REQUIRED U/S. 44AB OF THE INCOME TAX ACT. ON FACTS, T HE RETURN OF INCOME WAS DUE ON 31-10-2006, WHEREAS THE ACCOUNT WERE AUDITED ON 10-02-2007 WITH THE DELAY OF NEARLY FIVE MONTHS. A.O SOUGHT FOR THE REASON S FOR SUCH DELAY. IN RESPONSE, THE ASSESSEE SUBMITTED MEDICAL CERTIFICATE DEPICTING THE SICKNESS OF THE ACCOUNTANT SHRI ASHOK VINAYAK KELKAR AS THE REASO N. THE SAID MEDICAL CERTIFICATE MENTIONS MEDICAL ADVISE OF COMPLETE BED REST FROM FEBRUARY, 2006 ITA NO. 1098/PN/09 A.Y 2006-07 PAGE 2 OF 3 TO OCTOBER, 2006, WHICH IS THE DUE MONTH FOR FILING OF RETURN OF INCOME. THERE IS NO EXPLANATION FOR THE DELAY FROM NOVEMBER, 2006 TO FE BRUARY, 2007. ACCORDINGLY, THE A.O LEVIED THE PENALTY FOR THE FOLLO WING REASONS:- IN VIEW OF THE ABOVE, I DO NOT AGREE WITH THE EXPL ANATION OFFERED BY THE ASSESSEE FOR THE REASON THAT:- -THE REPLY GIVEN BY THE ASSESSEE THAT HIS ACCOUNTAN T WAS NOT KEEPING GOOD HEALTH AND ALSO ASSESSEES MOTHER WAS ILL IS F OUND TO BE ROUTINE REPLY WHICH NORMALLY EVERY ASSESSEE WOULD SUBMIT. WHEN TH E ASSESSEE KNEW THAT THE ACCOUNTANT FREQUENTLY FELL ILL FOR MONTHS TOGETHER THE ASSESSEE COULD HAVE DONE ALTERNATE ARRANGEMENT TO COMPLETE T HE DAY TO DAY ACCOUNTS SO AS TO AVOID THE DELAY IN SUBMISSION OF INFORMATION TO THE AUDITOR. -THE ATTITUDE MANIFESTED BY THE ASSESSEE TO THE SHO W CAUSE NOTICE AND LETTER SERVED ON HIM SHOWS HIS LEAST INTEREST IN PU RSUING THE MATTER OF PENAL ACTION. -THE ASSESSEE IS REGULARLY BEING ADVISED BY THE REP UTED TAX CONSULTANT SHRI SUHAS N. BARTAKKE. THEREFORE THE ASSESSEE IS W ELL AWARE OF THE CONSEQUENCES OF THE FAILURE TO FILE THE AUDIT REPOR T IN THE PRESCRIBED TIME. 3. AGGRIEVED WITH THE SAME, ASSESSEE FILED AN APPEA L BEFORE THE CIT(A) WHO CONFIRMED THE PENALTY OF RS. 45,535/-. AGAIN AGGRIEVE D WITH THE SAME, ASSESSEE FILED THE PRESENT APPEAL BEFORE US. LD. COUNSEL MENTI ONED THAT THE CIT(A) ERRED IN CONFIRMING THE PENALTY FOR FAILURE TO GET THE EXPLA NATION ON DAY-TO-DAY BASIS. LD COUNSEL MENTIONED THAT THIS IS NOT THE REQUIREMENT OF THE LAW NOW. FURTHER, HE MENTIONED THAT THE PENALTY HAS TO BE DELETED IN THIS CASE. ON THE OTHER HAND, LD. DR FOR THE REVENUE RELIED ON BOTH THE ORDERS OF THE REVENUE AND DEMONSTRATED THE ABSENCE OF ANY REASONABLE CAUSE FOR T HE PERIOD FROM NOVEMBER, 2006 TO FEBRUARY, 2007. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE ORDERS OF THE REVENUE, WE HAVE ALSO PERUSED PARA 5 AND 6 OF THE IMPUGNED ORD ER, THE SAME ARE RELEVANT THEREFORE THE EXTRACT OF THE SAME ARE REPRODUCED :- 5. THE APPELLANT HAS NOT CHALLENGED THE LIABILITY TO PENALTY BUT HAS ATTEMPTED TO ARGUE THAT THERE WAS A REASONABLE CAUS E WHICH PREVENTED IT FROM AUDITING THE ACCOUNTS AND SUBSEQUENTLY FILING THE EVIDENCE THEREOF. THE APPELLANT HAS SUBMITTED A MEDICAL CERTIFICATE W HICH CERTIFIES THAT MR. ASHOK VINAYAK KELKAR AGED 60 YEARS HAD A DISC PROLA PSE AND WAS ADVISED COMPLETE BED REST FROM FEBRUARY, 2006 TO OCTOBER, 2 006. 6. THE CERTIFICATE REGARDING THE ACCOUNTANTS ILLN ESS IS HOWEVER ISSUED ON 08.07.2009 WHICH IS DURING THE CURRENCY OF THE A PPEAL. MOREOVER, THE ACCOUNTANT WAS ADVISED COMPLETE REST FROM FEBRUARY TO OCTOBER, 2006. THE ACCOUNTS COULD HAVE BEEN FINALIZED SHORTLY THER EAFTER. THE ACCOUNTS HAVE BEEN FINALIZED AND THE RETURN FILED ONLY AFTER A DELAY OF FIVE MONTHS. ITA NO. 1098/PN/09 A.Y 2006-07 PAGE 3 OF 3 THE APPELLANT HAS TO GIVE A DETAILED EXPLANATION ON DAY-TO-DAY BASIS FOR THE DELAY CAUSED IN ORDER TO AVOID THE PENALTY. AS NO SUCH DETAILED EXPLANATION WAS OFFERED, THE PENALTY LEVIED U/S. 27 1B IS CONFIRMED. 5. FROM THE ABOVE, IT IS EVIDENT THAT THE ACCOUNTANT S SICKNESS IS A CAUSE FOR THE DEFAULT IN QUESTION. HOWEVER, IT IS OBVIOUS THAT THERE ARE NO SPECIFIC REASONS MENTIONED OR DEMONSTRATED OR EVIDENCED EITHER BEFORE US OR BEFORE THE REVENUE AUTHORITIES BY THE ASSESSEE FOR THE PERIOD POST-OCTOBE R, 2006. THEREFORE, WHERE THERE IS NO REASON FOR THE DEFAULT, REASONABLENESS OF THE SAME DOES NOT ARISE. CONSIDERING THE ABSENCE OF ANY REASON, WE ARE OF THE O PINION THAT THE ORDER OF THE CIT(A) DOES NOT CALL FOR ANY INTERFERENCE. 6. IN THE RESULT APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON 21 ST JANUARY, 2011. SD/- SD/- (SHAILENDRAKUMAR YADAV) (D.KARUNAKAR A RAO) JUDICIAL MEMBER ACCOUNTANT MEMBE R PUNE DATED THE 21 ST JANUARY, 2011 R COPY OF THE ORDER IS FORWARDED TO : 1. ASSESSEE 2. ITO, WARD-3, RATNAGIRI 3. CIT(A), KOLHAPUR 4. CIT-I, KOLHAPUR 5. DR ITAT A BENCH, PUNE BY ORDER ASSISTANT REGISTRAR I.T.A.T PUNE