Thummala Dheeraj Reddy, Nizamabad V. Asst. Commissioner of Income Tax, Circle-1, Nizamabad

ITA 1495/Hyd/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2483 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 08-02-2018
• Assessment Year: 2013-2014
• Appeal Filed On: 21-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N SWAPNA
• Assessee Lawyers: K A SAI PRASAD
• Keywords: Reasonable cause
• Section: 273B

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SMT P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER ITA NO.1495/HYD/2017 ASSESSMENT YEAR: 2013-14 SHRI THUMMALA DHEERAJ REDDY, NIZAMABAD. PAN-ABZPT3624P VS. ACIT, CIRCLE-1, NIZAMABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI K.A. SAI PRASAD REVENUE BY : SMT. N. SWAPNA DATE OF HEARING : 08-02-2018 DATE OF PRONOUNCEMENT : 28-02-2018 ORDER PER P. MADHAVI DEVI, J.M.: THIS IS ASSESSEE APPEAL FOR THE A.Y 2013-14 AGAINST THE ORDER OF THE CIT(A)-5, HYDERABAD DATED 19-06-2017, CONFIRMING THE PENALTY OF RS. 1,50,000/- LEVIED BY THE A.O U/S 271B OF THE IT ACT. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE E-FILED ITS RETURN OF INCOME FOR THE A.Y 2013-14 ON 19-04.2014 ADMITTING TOTAL INCOME OF RS. 14,94,420/- AFTER CLAIMING DEDUCTION OF RS. 1,07,160/- UNDER CHAPTER VIA OF THE ACT. SINCE ASSESSEES GROSS TURNOVER WAS RS. 6,04,99,802/-, HE WAS REQUIRED TO FURNISH THE AUDIT REPORT U/S 44AB OF THE 2 ITA NO. 1495/HYD/2017 SHIR THUMMALA DHEERAJ REDDY, NIZAMABAD.. ACT WITHIN THE SPECIFIED DUE DATE AS OR WITHIN THE EXTENDED TIME LIMIT BUT THE ASSESSEE HAD FURNISHED IT ON 1-04-2014. THE A.O OBSERVED THAT AS PER CBDT ORDER U/S 119 OF THE IT ACT DATED 26.09.2013 AND DATED 24.10.2013 IN F.NO. 225/117/2013/ITA.II, THE DUE DATE FOR FURNISHING OF AUDIT REPORT U/S 44AB OF THE ACT FOR THE RELEVANT ASSESSMENT YEAR WAS ON 31.10.2013. SINCE THE ASSESSEE HAD FURNISHED THE AUDIT REPORT BEYOND THE DUE DATE, A.O ISSUED A NOTICE FOR PENALTY U/S 271B OF THE IT ACT. THE ASSESSEE FILED A LETTER GIVING THE REASONS FOR DELAY IN FILING OF THE AUDIT REPORT. IT WAS SUBMITTED THAT THE BOOKS OF ACCOUNTS WERE AUDITED ON 26.09.2013 BUT IT COULD NOT BE UPLOADED DUE TO THE SICKNESS OF THE ACCOUNTANT OF THE FIRM. IT WAS ALSO SUBMITTED THAT THE PAN CARD WAS MISPLACED BY THE ASSESSEE AND THEREFORE HE COULD NOT OBTAIN THE DIGITAL SIGNATURE FOR WHICH THE COPY OF THE PAN CARD IS COMPULSORILY REQUIRED. THE A.O WAS NOT CONVINCED BY THE ASSESSEES CONTENTIONS. THEREFORE HE LEVIED THE PENALTY OF RS. 1,50,000/- U/S 271B OF THE IT ACT. ON APPEAL THE CIT(A) CONFIRMED THE ORDER OF THE A.O AND THE ASSESSEE IS IN SECOND APPEAL BEFORE US. 3 ITA NO. 1495/HYD/2017 SHIR THUMMALA DHEERAJ REDDY, NIZAMABAD.. 3. THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BY THE ASSESSEE BEFORE THE AUTHORITIES BELOW AND SUBMITTED THAT THE ISSUE HAD ARISEN FOR TWO ASSESSMENT YEARS I.E A.YS 2013-14 AND 2014-15 AND THE CIT(A) HAS ACCEPTED THE ASSESSEES EXPLANATION FOR THE DELAY IN THE A.Y 2014-15 BUT HAS CONFIRMED THE PENALTY FOR THE A.Y 2013-14. HE FURTHER SUBMITTED THAT THIS IS THE FIRST YEAR IN WHICH THE ASSESSEE WAS REQUIRED TO FILE THE AUDIT REPORT ELECTRONICALLY AND FOR THE REASONS STATED BEFORE THE AUTHORITIES BELOW, THE ASSESSEE COULD NOT UPLOAD THE AUDIT REPORT NOR COULD HE FILE IT MANUALLY BEFORE THE A.O BEFORE THE DUE DATE OF FILING OF THE RETURN. HE SUBMITTED THAT THE ASSESSEE HAS BONA-FIDE REASONS FOR NOT FURNISHING THE AUDIT REPORT ON TIME, THOUGH THE BOOKS OF ACCOUNTS WERE AUDITED BEFORE THE DUE DATE OF FILING OF THE RETURN. HE THEREFORE PRAYED THAT THE PENALTY BE DELETED. 4. THE LD. DR ON THE OTHER HAND, SUBMITTED THAT THE ASSESSEE HAS FAILED TO FURNISH THE CONVINCING REASON FOR NOT FILING OF THE AUDIT REPORT MANUALLY BEFORE THE DUE DATE OF FILING OF THE RETURN AND THEREFORE THE LEVY OF PENALTY IS JUSTIFIED. 4 ITA NO. 1495/HYD/2017 SHIR THUMMALA DHEERAJ REDDY, NIZAMABAD.. 5. HAVING REGARD TO THE RIVAL CONTENTIONS AND MATERIAL ON RECORD, WE FIND THAT THE CIT(A) HAS ACCEPTED THE ASSEESSEES CONTENTIONS FOR CONDONING THE DELAY OF THREE DAYS IN FILING OF THE AUDIT REPORT FOR THE A.Y 2014-15 BUT FOR THE A.Y 2013-14, HE REFUSED TO ACCEPT THE SAID EXPLANATION TO CONDONE THE DELAY, BY OBSERVING THAT THE ASSESSE HAS GIVEN DIFFERENT REASONS FOR DIFFERENT ASSESSMENT YEARS. WE FIND THAT THIS FINDING OF THE CIT(A) IS INCORRECT. FURTHER AS SUBMITTED BY THE ASSESSEE, THIS IS THE FIRST YEAR IN WHICH THE ASSESSEE WAS REQUIRED TO FILE THE AUDIT REPORT ELECTRONICALLY OR MANUALLY BEFORE THE A.O. FOR THE PENALTY U/S 271B OF THE IT ACT, THE PROVISIONS OF SEC. 273B OF THE IT ACT ARE APPLICABLE. THE ASSESSEE HAS GIVEN THE REASON FOR NOT BEING ABLE TO FILE THE AUDIT REPORT AS THE SICKNESS OF ITS ACCOUNTANT. THE REASONS GIVEN BY THE ASSESSEE FOR THE DELAY IN FILING OF THE AUDIT REPORT ARE NOT DOUBTED OR FOUND TO BE FALSE BY THE DEPARTMENT. THEREFORE, IN OUR OPINION, THE ASSESSEE HAS SHOWN REASONABLE CAUSE FOR NOT FILING OF THE AUDIT REPORT ELECTRONICALLY OR MANUALLY BEFORE THE DUE DATE OF FILING OF THE RETURN. SINCE ASSESSEE HAS GOT ITS BOOKS AUDITED BEFORE THE DUE DATE OF FILING OF THE RETURN, WE ARE INCLINED TO ACCEPT THE REASONABLE CAUSE PLEADED BY THE 5 ITA NO. 1495/HYD/2017 SHIR THUMMALA DHEERAJ REDDY, NIZAMABAD.. ASSESSEE. ACCORDINGLY, APPEAL IS ALLOWED AND THE PENALTY U/S 271B IS DELETED. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON 28 TH FEBRUARY, 2018. SD/- SD/- (B. RAMAKOTAIAH) (P. MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED: 28 TH FEBRUARY, 2018. KRK 1 SHRI THUMMALA DHEERAJ REDDDY, C/O, PARTHASARATHY & CO., 1-1-298/2/B/B, 1 ST FLOOR, SOWBHGYA AVENUE, ST. NO.1, ASHOKNAGAR, HYDERABAD-500 020. 2 ASST CIT, CIRCLE-1, HYDERABAD. 3 CIT(A)-5, HYDERABAD 4 CIT-5, HYDERABAD. 5 THE DR, ITAT HYDERABAD 6 GUARD FILE