Jain Cooperative Bank Ltd., New Delhi V. ITO, New Delhi

ITA 1525/DEL/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3927 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 30-05-2011
• Assessment Year: 2008-2009
• Appeal Filed On: 29-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K MONGA
• Assessee Lawyers: SUNIL ARORA
• Keywords: Reasonable cause
• Section: 274

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D NEW DELHI BEFORE SHRI R.P. TOLANI AND SHRI K.G. BANSAL ITA NO. 1525/DEL/2011 ASSTT. YR: 2008-09 JAIN COOPERATIVE BANK LTD., VS. INCOME-TAX OFFICE R, 80, DARYA GANJ, NEW DELHI. WARD 30(2), NEW DELHI. PAN/GIR NO. AAAAJ0060A (APPELLANT ) ( RESPONDENT ) APPELLANT BY : SHRI SUNIL ARORA CA RESPONDENT BY : SHRI A.K. MONGA SR. DR O R D E R PER R.P. TOLANI, J.M : THIS IS ASSESSEES APPEAL CHALLENGING THE ORDER OF CIT(A) DATED 17-2- 2011, SUSTAINING THE PENALTY OF RS. 1 LAKH IMPOSED BY THE AO U/S 271B OF THE I.T. ACT FOR A.Y. 2008-09. 2. FACTS IN BRIEF ARE THAT ASSESSEE, A COOPERATIVE BANK, FOR A.Y. 2008-09 WAS REQUIRED TO GET ITS ACCOUNTS AUDITED U/S 44AB O F THE I.T. ACT AND FURNISH A REPORT OF SUCH AUDIT ON OR BEFORE THE PRESCRIBED TIME LIMIT I.E. 30-9-2008. HOWEVER, THE RETURN ALONG WITH AUDIT REPORT IN FORM NO. 3CA AND 3CD DATED 5-11-2008, WAS FILED ON 6-11-2008. THE AO ISSUED N OTICE U/S 274 READ WITH SECTION 271B OF THE ACT REQUIRING THE ASSESSEE TO S HOW CAUSE AS TO WHY PENALTY U/S 271B OF THE ACT BE NOT IMPOSED. IN RESP ONSE, ASSESSEES EXPLANATION WAS THAT THOUGH STATUTORY AUDITORS WERE APPOINTED ON 15-4-2008, ITA 1525/DEL/11 JAIN COOPERATIVE BANK LTD. VS. ITO 2 THE STATUTORY AUDIT COULD BE COMPLETED ON 24-10-200 8 AND THE TAX AUDIT REPORT WAS SIGNED ON 5-11-2008 AND IMMEDIATELY THER EAFTER THE RETURN, ALONG WITH AUDIT REPORT, WAS FILED ON 6-11-2008. REJECTI NG THE EXPLANATION FURNISHED BY THE ASSESSEE THE AO IMPOSED A PENALTY OF RS. 1,00,000/- U/S 271B FOR NOT GETTING ITS ACCOUNTS AUDITED U/S 44AB OF THE I.T. ACT IN TIME. IN FIRST APPEAL, THE CIT(A) CONFIRMED THE ACTION OF THE AO. AGGRIEVED, THE ASSESSEE IS BEFORE US. 3. LEARNED COUNSEL FOR THE ASSESSEE CONTENDS THAT L OWER AUTHORITIES HAVE FAILED TO APPRECIATE THAT DELAY IN FILING THE AUD IT REPORT WAS DUE TO A REASONABLE CAUSE BEYOND THE CONTROL OF THE ASSESSEE . AS PER COOPERATIVE SOCIETIES ACT, A STATUTORY AUDITOR IS APPOINTED BY THE REGISTRAR OF COOPERATIVE SOCIETIES AND UNLESS STATUTORY AUDIT IS CARRIED OUT U/S 44AB, AUDIT REPORT CANNOT BE OBTAINED. THIS BEING REASONA BLE CAUSE PENALTY U/S 271B FOR NOT FILING AUDIT REPORT U/S 44AB WITHIN TH E PRESCRIBED TIME LIMIT MAY BE DELETED. 4. THE LEARNED DR SUPPORTED THE ORDERS OF AUTHORITI ES BELOW. 5. WE HAVE HEARD RIVAL SUBMISSIONS OF THE PARTIES A ND HAVE GONE THROUGH THE RELEVANT MATERIAL AVAILABLE ON RECORD. IN OUR V IEW, SINCE MANDATORY STATUTORY AUDIT ITSELF WAS CARRIED OUT LATE, THE DE LAY OF 38 DAYS IN FILING THE AUDITED REPORT CAN BE ATTRIBUTED TO A REASONABLE CA USE WHICH WAS BEYOND THE ITA 1525/DEL/11 JAIN COOPERATIVE BANK LTD. VS. ITO 3 CONTROL OF THE ASSESSEE. WE FIND MERIT IN THE ARGUM ENT OF LEARNED COUNSEL FOR THE ASSESSEE AND DELETE THE PENALTY LEVIED U/S 271B OF THE ACT. 6. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 30-05-2011. SD/- ( K.G. BANSAL ) ( R.P. TOLANI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 30-05-2011. MP COPY TO : 1. ASSESSEE 2. AO 3. CIT 4. CIT(A) 5. DR