Mysore Ammonia Pvt Ltd , Bangalore V. Assistant Commissioner of Income Tax Circle-12(1), Bangalore

ITA 1281/BANG/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 4774 (ITAT-BANGALORE)
• Duration Of Justice: 11 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2011-2012
• Appeal Filed On: 08-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR P V PRADEEP KUMAR
• Section: 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, B ENGALURU BEFORE S HRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER I TA NO. 1281 / BANG/2 0 1 7 (ASSESSMENT YEAR: 20 1 1 - 12 ) MYSORE AMMONIA (P) LTD., NO.233, 3 RD FLOOR, RAJANIGAN DHA GARDEN APARTMENT, NO.21, VITTAL MALLYA ROAD, BENGALURU - 560001. PAN:A ABCM1749E VS. APPELLANT ASST. COMMISSIONER OF INCOME - TAX CIRCLE 12(1), BENGALURU. RESPONDENT APPELLANT BY : SHRI ANIL KUMAR, CA. RESPONDENT BY : DR.P.V.PRADEEP KUMAR, ADDL. CIT(DR) DATE OF HEARING : 22 /03/2018 DATE OF PRONOUNCEMENT : 31 /05/2018 O R D E R PER I NTURI RAMA RAO, AM : THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) - 4, BENGALURU, [CIT(A) DATED 27/03/2017 FOR THE ASSESSMENT YEAR 2011 - 12 CONFIRMIGN THE LEVY OF PENALTY U/S 271B OF THE INCOME - TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT' FOR SHORT]. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS A COMPANY DULY INCORPORATED UNDER THE PROVISIONS OF THE COMPANIES ACT, 1956. IT FILED RETURN OF INCOME FOR THE ASSESSMENT YEAR 2011 - 12 ON 01/08/2012. THE ASSESSING OFFICER (AO) NOTICED THAT THE ASSESSEE - COMPANY HAS NOT GOT THE BOOKS OF ACCOUNT AUDITED AS PRESCRIB ED U/S 44AB OF THE ACT BY THE DUE DATE FOR FILING RETURN OF INCOME U/S 139 OF THE ACT. ACCORDINGLY, AO ISSUED SHOW CAUSE NOTICE PROPOSING TO LEVY PENALTY U/S 271B OF THE ACT. IN RESPONSE TO THE SHOW CAUSE NOTICE, IT WAS STATED THAT THE ASSESSEE - COMPANY H AD THE HEAD OFFICE AT BENGALURU AND FOUR BRANCHES ITA NO . 128 1/ BANG/20 17 PAGE 2 OF 3 AT CHENNAI, MANGALORE, MUMBAI AND HYDERABAD AND THE ACCOUNTS OF THE BRANCHES ARE AUDITED BY THE LOCAL AUDITORS AND THE DELAY IN GETTING ACCOUNTS AUDITED WAS CAUSED ON ACCOUNT OF DELAY IN RECEIVING AUDIT REP ORTS FROM RESPECTIVE BRANCH AUDITORS. FURTHER, IT IS STATED THAT THE AUDIT REPORT WAS FURNISHED ALONG WITH RETURN OF INCOME AND THE ASSESSMENT WAS COMPLETED CONSIDERING THE AUDIT REPORT AND NO PREJUDICE IS CAUSED TO THE REVENUE ON ACCOUNT OF DELAY IN OBTA INING AUDIT REPORT. THEREFORE, IT IS PRAYED THAT PENALTY LEVIED U/S 271B BE DELETED. 3. BEING AGGRIEVED, AN APPEAL WAS PREFERRED BEFORE THE LD.CIT(A), WHO , VIDE IMPUGNED ORDER, CONFIRMED THE PENALTY. 4. LEARNED AR OF THE ASSESSEE RE - ITERATED THE SAME EXPLANATIONS FILED BEFORE THE LOWER AUTHORITIES. ON THE OTHER HAND, LD. ADDL.CIT(DR) SUPPORTED THE ORDERS OF THE LOWER AUTHORITIES. 5. WE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ONLY ISSUE IN THE PRESENT APPEAL IS WHETHER PENA LTY U/S 271B CAN BE LEVIED HAVING REGARD TO THE EXPLANATION FILED BEFORE THE AO. THE PROVISIONS OF SECTION 271B PRESCRIBE LEVY OF PENALTY FOR FAILURE TO GET THE ACCOUNTS AUDITED. IN THE PRESENT CASE, IT IS NOT THE CASE OF THE AO THAT THERE IS FAILURE ON THE PART OF THE ASSESSEE TO GET THE ACCOUNTS AUDITED. SINCE NO PREJUDICE IS CAUSED TO REVENUE ON ACCOUNT OF DELAY IN OBTAINING THE AUDIT REPORT AND THE EXPLANATION TENDERED BY THE ASSESSEE CAN BE SAID TO BE A PLAUSIBLE EXPLANATION. IN OUR CONSIDERED OPI NION, IT IS NOT A FIT CASE FOR LEVY OF PENALTY. ACCORDINGLY, WE DELETE THE PENALTY LEVIED U/S 271B OF THE ACT. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE - COMPANY IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST MAY, 2018 SD/ - SD/ - (SUNIL KUMAR YADAV) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE : BENGALURU. D A T E D : 31/05/2018 SRINIVASULU, SPS ITA NO . 128 1/ BANG/20 17 PAGE 3 OF 3 COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A) 4 CIT 5 DR, ITAT, BANGALORE. 6 GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY INCOME - TAX APPELLATE TRIBUNAL B ANGALORE