Shri Kangvi Vibhag Bandhkam Adivasi Majoor Shahkari Mandli Ltd, V. The Income tax Officer,Wrd-2, Valsad

ITA 1476/AHD/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 6323 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-05-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 24-05-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 28-04-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JYOTI LAXIMI SRDR
• Keywords: Reasonable cause

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH AT SURAT CAMP, AHMEDABAD BEFORE SHRI T.K. SHARMA, JUDICIAL MEMBER, AND SHRI D. C. AGRAWAL, ACCOUNTANT MEMBER ITA NO.1476/AHD/2008 ASSESSMENT YEAR: 2005-06 DATE OF HEARING:24.5.10 DRAFTED:25.5.10 KANGVI VIBHAG BANDHKAMR KARMARI ADIVASI MAJOOR SAAAHKARI MANDLI LTD. AT: VILLAGE, KANGVI, TAL. DHARAMPUR, DIST. VALSAD PAN NO.AAAAK4719R V/S . INCOME TAX OFFICER, WARD-2, VALSAD (APPELLANT) .. (RESPONDENT) APPELLANT BY :- SHRI RAJESH UPADHYAY, AR RESPONDENT BY:- SMT. JYOTI LAXIMI, SR-DR O R D E R PER D.C.AGRAWAL, ACCOUNTANT MEMBER:- THIS IS AN APPEAL FILED BY ASSESSEE AGAINST THE OR DER OF LD. CIT(APPEALS)-VALSAD, WHEREIN HE CONFIRMED THE PENALTY U/S.271B LEVIED AT RS.30,337/-. 2. WE HAVE HEARD THE PARTIES AND PERUSED THE MATERI ALS ON RECORD. THE PENALTY HAS BEEN IMPOSED ON THE GROUND THAT THE ASSESSEE HAS NOT GOT ITS ACCOUNT AUDITED AS REQUIRED U/S.44AB OF THE ACT. ACCORDING TO ASSESSING OFFICER, ASSESSE E IS FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING. THE ASSESSEE IS CARRYING ON BUSINESS O F CONSTRUCTION WORK AND ITS TURNOVER EXCEEDED RS. 40 LAKHS BEING AT RS.60,76,362/-. THE ASSESSEE DID NOT GET ITS ACCOUNT AUDITED IN TIME. HOWEVER, AUDIT REPORT WAS FILED ON 31-07- 2007. ACCORDINGLY HAVING NOT BEEN SATISFIED WITH THE EXPLANATION ASSESSING OFFICER LE VIED THE PENALTY OF RS.30,30,337/-. ITA NO.1476/AHD/2008 A.Y. 2005-06 KVBKAMSM. LTD. V. ITO WD-2, VLS PAGE 2 3. LD. CIT(APPEALS) CONFIRMED THE PENALTY ON THE GR OUND THAT NO REASONABLE CAUSE FOR NON-FILING OF AUDIT REPORT IS FURNISHED. 4. WE HAVE HEARD THE PARTIES AND CAREFULLY PERUSED THE MATERIALS ON RECORD. LD. AR SUBMITTED THAT ASSESSEE CONSIDERED THAT ITS INCOME IS EXEMPT BY VIRTUE OF SEC.80P(2)(VI) AND ALSO U/S.10(27) OF THE ACT THEREFORE IT NEED NOT FI LE THE RETURN OF INCOME. ACCORDINGLY, HE DELAYED THE AUDITING OF ACCOUNTS. IT IS A REASONAB LE CAUSE THEREFORE NO PENALTY SHOULD BE LEVIED. 5. ON THE OTHER HAND, LD. SR-DR RELIED ON THE ORDER S OF THE AUTHORITIES BELOW. 6. INCOME OF THE ASSESSEE IS EXEMPT U/S.80P(2)(VI). AS IT IS A CO-OPERATIVE SOCIETY. IT DELAYED THE AUDITING OF ACCOUNTS. THIS CONSTITUTED REASONABLE CAUSE. IT IS NOT A CASE WHERE ACCOUNTS WERE NOT GOT AUDITED AT ALL BUT A CASE A D ELAYED AUDITING. SINCE THE ASSESSEE WAS UNDER BONA FIDE BELIEF THAT ITS INCOME IS NOT LIABL E TO TAX AND ACCORDINGLY ACCOUNT WAS DONE BELATEDLY. THIS A REASONABLE CAUSE AND HENCE WE DEL ETE THE PENALTY. 7. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLO WED. ORDER PRONOUNCED IN OPEN COURT ON 28/05/2010 SD/- SD/- (T.K.SHARMA) (D.C.AGRAWAL) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD, DATED : 28/05/2010 *DKP COPY OF THE ORDER FORWARDED TO :- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(APPEALS)-VLS 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD