Tilari Samabay Krishi Unnayan samity Ltd., Kolkata V. ACIT, Cir-23, Hooghly, Hooghly

ITA 1950/KOL/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 4498 (ITAT-KOLKATA)
• Duration Of Justice: 11 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 31-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A BHATTACHARJEE
• Keywords: Bonafide belief; Reasonable cause
• Section: 273B; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : KOLKATA [BEFORE HONBLE SHRI M.BALAGANESH, AM & HONBLE S HRI S.S.VISWANETHRA RAVI, JM] I.T.A NO. 1950/KOL/20 17 ASSESSMENT YEAR : 2012-1 3 TILARI SAMABAY KRISHI UNNAYAN SAMITY LTD. -VS- ACIT, CIRCLE-23, HOOGHLY [PAN: AADAT 6994 J] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : SHRI ANIL KOCHAR, ADVOCATE FOR THE RESPONDENT : SHRI A. BHATTACHARJEE, ADDL. CIT DATE OF HEARING : 07.08.2018 DATE OF PRONOUNCEMENT : 10.08.2018 ORDER PER M.BALAGANESH, AM 1. THIS APPEAL BY THE ASSESSEE ARISES OUT OF THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS)-6, KOLKATA [IN SHORT THE LD CIT (A)] IN APPEAL NO.138/CIT(A)- 6/KOL/2015-16 DATED 12.06.2017 AGAINST THE ORDER PA SSED BY THE ACIT, CIRCLE-23, HOOGHLY [ IN SHORT THE LD AO] UNDER SECTION 143(3) READ WITH SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) DATED 23 .01.2015 FOR THE ASSESSMENT YEAR 2012-13. 2. THE ONLY ISSUE TO BE DECIDED IN THIS APPEAL IS A S TO WHETHER THE LD. CIT(A) WAS JUSTIFIED IN UPHOLDING THE LEVY OF PENALTY U/S 271B OF THE ACT IN THE SUM OF RS. 77,478/-, IN THE FACTS AND CIRCUMSTANCES OF THE CAS E. 2 ITA NO.1950/KOL/2017 TILARI SAMABAY KRISHI UNNAYAN SAMITY LTD. A.YR. 2012-13 2 3. THE BRIEF FACTS OF THIS APPEAL IS THAT THE ASSES SEE IS A CO-OPERATIVE SOCIETY AND HAD FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2012-13 ON 24.03.2014 ELECTRONICALLY DECLARING NIL INCOME AFTER CLAIMING DEDUCTION U/S 80P(2) OF THE ACT. THE ASSESSEE CLAIMED TO HAVE OBTAINED THE TAX AUDIT REPORT FROM ITS TAX AUDITOR ON 24.09.2012 BUT SINCE THE RETURN OF INCOME WAS FILED BELATEDLY ONLY ON 24.03.2014, THE TAX AUDIT REPORT WAS ALSO FILED ELECTRONICALLY ALONG WITH RETURN OF INCOME ON 24.03.2014. IT IS NOT IN DISPUTE BEFORE US THAT THE ASSESSEE HAS RENDERED SE RVICES ONLY TO ITS MEMBERS OF THE SOCIETY AND THERE IS NO DISPUTE ABOUT THE ELIGIBILI TY OF CLAIM OF DEDUCTION U/S 80P(2) OF THE ACT FOR THE ASSESSEE SOCIETY DURING THE YEAR UN DER CONSIDERATION. SINCE THE TAX AUDIT REPORT IN FORM NO. 3CB AND 3CD WAS FILED BELA TEDLY BY THE ASSESSEE ON 24.03.2014, THE LD. AO PROCEEDED TO LEVY PENALTY U/ S 271B OF THE ACT. THE ASSESSEE REPLIED THAT IT WAS UNDER THE BONAFIDE BELIEF THAT IT WAS RENDERING SERVICES ONLY TO ITS MEMBERS AND THAT ITS ENTIRE INCOME WAS ELIGIBLE FOR DEDUCTION U/S 80P(2) OF THE ACT, AND HENCE THERE WAS NO OBLIGATION ON THE PART OF T HE ASSESSEE TO FILE ANY RETURN OF INCOME EVEN THOUGH THE ACCOUNTS OF THE ASSESSEE WER E DULY AUDITED BY THE INDEPENDENT TAX AUDITOR AND REPORT OBTAINED THEREON ON 24.09.20 12 ITSELF. THIS EXPLANATION WAS NOT FOUND SATISFACTORY BY THE LD. AO AND ACCORDINGLY PE NALTY U/S 271B WAS LEVIED IN THE SUM OF RS. 77,478/- BEING 0.5% OF THE GROSS RECEIPT S OF THE ASSESSEE. THE LD. AO ALSO HELD IN HIS ORDER THAT THE CLAIM OF THE ASSESSEE TH AT THE TAX AUDIT REPORT WAS OBTAINED FROM THE TAX AUDITOR ON 24.09.2012 DOES NOT APPEAR TO BE CORRECT BECAUSE HAD IT BEEN OBTAINED IN TIME, THERE WAS NO REASON FOR THE ASSES SEE TO DELAY THE FILING OF ITS RETURN OF INCOME. THE LD. AO ALSO OBSERVED IN HIS PENALTY OR DER THAT THE TAX AUDIT REPORT WAS NOT OBTAINED UP TO 31.03.2013 BY THE ASSESSEE. BASED ON THESE OBSERVATIONS, HE VALIDATED THE LEVY OF PENALTY U/S 271B OF THE ACT. THIS ACTIO N OF THE LD. AO WAS UPHELD BY THE LD. CIT(A). AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD RIVAL SUBMISSIONS. WE FIND THAT TH E LD. AR HAD PLACED ON RECORD THE COPY OF THE BALANCE SHEET OF THE ASSESSEE CO-OPERAT IVE SOCIETY AS ON 31.03.2012 WHICH 3 ITA NO.1950/KOL/2017 TILARI SAMABAY KRISHI UNNAYAN SAMITY LTD. A.YR. 2012-13 3 WAS DULY SIGNED BY THE SENIOR AUDIT OFFICER OF CO- OPERATIVE SOCIETIES DEPARTMENT ON 30.01.2013. THE LD. AR HAS STATED THAT THIS IS THE FIRST YEAR OF APPLICABILITY OF TAX AUDIT PROVISIONS FOR THE ASSESSEE. THE LD. AR ALSO PLACE D ON RECORD THE COPY OF ENTIRE AUDITED ACCOUNTS FOR THE YEAR ENDED 31.03.2012 TOGE THER WITH THE TAX AUDIT REPORT IN FORM NO. 3CB AND 3CD (ENCLOSED IN PAGES 10 TO 21 OF THE PAPER BOOK) AND FILED BEFORE THE LD. AO BEFORE COMPLETION OF THE ASSESSME NT PROCEEDINGS ON WHICH FACT, THERE IS NO DISPUTE. THE SAID AUDITED ACCOUNTS AND THE TAX AUDIT REPORT WAS DATED 24.09.2012 I.E. MUCH BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME U/S 139(1) OF THE ACT. WE ALSO FIND THAT THE SENIOR AUDIT OFFICER OF THE CO-OPERATIVE SOCIETIES DEPARTMENT HAD VERIFIED THE AUDITED ACCOUNTS OF THE ASSESSEE AS ON 31.03.2012 AND HAD ENDORSED THE SAME BY AFFIXING HIS SIGNATURE ON 30. 1.2013. THIS FACT CLEARLY GOES TO PROVE THAT THE ACCOUNTS WERE DULY SUBJECTED TO THE TAX AUDIT AND REGULAR AUDIT BY THE ASSESSEE SOCIETY AND MUCH BEFORE 30.01.2013. HENCE THE OBSERVATION OF THE LD. AO THAT THE AUDITED ACCOUNTS WERE NOT PREPARED UP TO 3 1.3.2013 IN HIS PENALTY ORDER IS FACTUALLY INCORRECT. IN ANY CASE, WE FIND THAT THE REVENUE HAD NOT BROUGHT ANY CONTRARY MATERIAL OR EVIDENCES ON RECORD TO PROVE THAT THE A SSESSEE HAD NOT OBTAINED THE TAX AUDIT REPORT FROM ITS TAX AUDITOR ON 24.09.2012, WH EREAS THE SAME AUDITED ACCOUNTS WERE MADE AVAILABLE BEFORE THE SENIOR AUDIT OFFICER OF THE CO-OPERATIVE SOCIETIES DEPARTMENT FOR VERIFICATION AND THE SAID OFFICER HA D ALSO AFFIXED SIGNATURE IN THE SAID BALANCE SHEET ON 30.01.2013. WE HAVE ALSO GONE TH ROUGH THE BALANCE SHEET SIGNED BY THE TAX AUDITOR AND THE BALANCE SHEET ENDORSED BY T HE AUDIT OFFICER OF THE CO-OPERATIVE SOCIETIES DEPARTMENT WHEREIN, WE FIND NO DISCREPAN CY IN THE FIGURES REFLECTED THEREON. IN THESE FACTS AND CIRCUMSTANCES, IT CANNOT BE SAID THAT THE TAX AUDIT REPORT WAS NOT OBTAINED BY THE ASSESSEE ON 24.09.2012 TO DISREGARD THE CLAIM OF THE ASSESSEE. HENCE, THE LEVY OF PENALTY U/S 271B OF THE ACT DOES NOT SU RVIVE. 5. WE ALSO FIND THAT THE LEVY OF PENALTY U/S 271B I S SUBJECT TO PROVISIONS OF SECTION 273B OF THE ACT WHEREIN THE ASSESSEE ON ADDUCING RE ASONABLE CAUSE FOR NOT FILING AUDIT 4 ITA NO.1950/KOL/2017 TILARI SAMABAY KRISHI UNNAYAN SAMITY LTD. A.YR. 2012-13 4 REPORT WOULD BE ENTITLED FOR IMMUNITY FROM LEVY OF PENALTY. IN THE INSTANT CASE, THE ASSESSEES BONAFIDE BELIEF THAT IT WAS NOT ENTITLED TO FILE ITS RETURN OF INCOME AND IT HAD NO TAXABLE TOTAL INCOME IN VIEW OF ITS ELIGIBILITY TO CLAIM DEDUCTION U/S 80P(2) OF THE ACT STANDS OUT AS A REASONABLE CAUSE WITHIN THE MEA NING OF SECTION 273B OF THE ACT. HENCE THE ASSESSEE WOULD BE ENTITLED FOR IMMUNITY F ROM LEVY OF PENALTY U/S 273B OF THE ACT. ACCORDINGLY, GROUNDS RAISED BY THE ASSESSE E ARE ALLOWED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE COURT ON 10.08.2018 SD/- SD/- [S.S. VISWANETHRA RAVI] [ M.BAL AGANESH ] JUDICIAL MEMBER ACCOUNTANT MEM BER DATED : 10.08.2018 SB, SR. PS COPY OF THE ORDER FORWARDED TO: 1. TILARI SAMABAY KRISHI UNNAYAN SAMITY LTD., C/O, S.L. KOCHAR, ADVOCATE, 86, CANNING STREET, KOLKATA-1. 2. ACIT, CIRCLE-23, HOOGHLY, 54/1, RAFI AHMED KIDWA I ROAD, KOLKATA-700016. 3..C.I.T.(A)- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVAT E SECRETARY HEAD OF OFFICE/D.D.O., ITAT, KOLKATA BENCHE S