M/s. Thakur Savadekar & Co. Pvt. Ltd., Pune V. Deputy Commissioner of Income-tax,

ITA 2304/PUN/2016

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 2826 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 03-10-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MAHADEVAN
• Keywords: Reasonable cause
• Section: 273B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUN E BEFORE SHRI R.S. SYAL, VP AND SHRI VIKAS AWASTHY, JM / ITA NO. 2304/PUN/2016 / ASSESSMENT YEAR : 2011-12 M/S. THAKUR SAVADEKAR & COMPANY PRIVATE LIMITED. 377, GURWAR PETH, NEAR JAIN MANDIR, FULWALA CHOWK, PUNE-411 042 PAN : AAACT3909J ....... / APPELLANT / V/S. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-7, PUNE. / RESPONDENT ASSESSEE BY : SHRI C.H. NANIWADEKAR REVENUE BY : SHRI MAHADEVAN / DATE OF HEARING : 05.11.2018 / DATE OF PRONOUNCEMENT : 06.11.2018 / ORDER PER VIKAS AWASTHY, JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORD ER OF COMMISSIONER OF INCOME TAX (APPEALS), PUNE-5, PUNE DATED 2 2.07.2016 CONFIRMING LEVY OF PENALTY U/S.271B OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). 2 ITA NO.2304 /PUN/2016 A.Y.2011-12 2. SHRI C.H. NANIWADEKAR APPEARING ON BEHALF OF THE ASSESS EE SUBMITTED THAT PENALTY U/S.271B OF THE ACT HAS BEEN LEVIE D FOR DELAY IN FILING STATUTORY TAX AUDIT REPORT IN COMPLIANCE OF THE PROVIS IONS OF SECTION 44AB OF THE ACT. THE LD. AR SUBMITTED THAT BEFORE THE AUT HORITIES BELOW REASONS FOR DELAY IN FILING STATUTORY TAX AUDIT REPORT WAS EXPLAINED. THE DUE DATE FOR FILING RETURN OF INCOME AND TAX AUDIT REPORT FOR AS SESSMENT YEAR 2011-12 WAS 30.09.2011. THE TAX AUDIT REPORT WAS FILED ON 30.12.2011 I.E. WITH THE DELAY OF 3 MONTHS. THE DELAY OCCURRED IN FILING TAX AUDIT REPORT DUE TO RESIGNATION OF STATUTORY AUDITORS OF THE ASSESSEE -COMPANY DURING FINANCIAL YEAR 2010-11. NEW STATUTORY TAX AUDITORS WERE APPOINTED ON 12.01.2011. FURTHER, ACCOUNTANT OF THE COMPANY WHO WAS LO OKING AFTER THE FINALIZATION OF BALANCE SHEET AND INCOME TAX MATTERS, HAD ALS O RESIGNED FROM ASSESSEE-COMPANY ON 27.12.2010. IT TOOK SOME TIME FOR THE NEW INCUMBENT TO UNDERSTAND FINANCIAL AFFAIRS OF THE COMPANY. TH IS RESULTED IN DELAY OF 3 MONTHS IN FILING TAX AUDIT REPORT. THE LD. AR SUBMIT TED THAT THE DELAY IN FILING TAX AUDIT REPORT WAS NOT INTENTIONAL OR HAS A NY MALA-FIDE REASONS. 3. ON THE OTHER HAND, SHRI MAHADEVAN REPRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED THE IMPUGNED ORDER IN CONFIRMING LEVY OF PENALTY U/S.271B OF THE ACT. THE LD. DR SUBMITTED THAT AS PER PROVISIONS OF TH E ACT, ANY DELAY IN FILING OF THE STATUTORY TAX AUDIT REPORT ATTRA CTS PENALTY. THE REASONS GIVEN BY THE ASSESSEE FOR DELAY IN FILING STATUTORY TAX AUDIT REPORT DO NOT CONSTITUTE REASONABLE CAUSE U/S. 273B OF THE ACT. 4. WE HAVE HEARD THE SUBMISSIONS MADE BY REPRESENTAT IVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF AUTHORITIES BELOW. THE ASSESSEE IN 3 ITA NO.2304 /PUN/2016 A.Y.2011-12 APPEAL HAS ASSAILED LEVY OF PENALTY OF RS.1,00,000/- U/S.271 B OF THE ACT FOR DELAY IN FILING OF THE STATUTORY TAX AUDIT REPORT BY 3 MONT HS. DUE DATE FOR FILING TAX AUDIT REPORT WAS 30.09.2011. HOWEVER, THE SAME W AS FILED BY ASSESSEE ON 30.12.2011. A PERUSAL OF THE IMPUGNED ORDER S HOWS THAT THE DELAY IN FILING OF STATUTORY TAX AUDIT REPORT HAS BEEN ATT RIBUTED TO RESIGNATION OF STATUTORY TAX AUDITORS AND THE ACCOUNTAN T OF THE COMPANY WHO WAS LOOKING AFTER THE TAX MATTERS IN FINANCIAL YEAR 2 010-11 I.E. THE PERIOD RELEVANT TO ASSESSMENT YEAR 2011-12. THE NEW ST ATUTORY TAX AUDITORS WERE APPOINTED BY THE ASSESSEE ON 12.01.2011. T HE NEW INCUMBENT TOOK SOME TIME TO UNDERSTAND FINANCIAL AFFAIRS OF T HE ASSESSEE- COMPANY. THE REASON FOR DELAY AS EXPLAINED BY ASSESSEE H AS NOT BEEN DISPUTED BY THE REVENUE. WE ARE OF CONSIDERED VIEW THAT THE REASON FOR DELAY IN FILING TAX AUDIT REPORT U/S.44AB OF THE ACT IS A RE ASONABLE CAUSE WITHIN THE MEANING OF SECTION 273B OF THE ACT. WE FIND MERIT IN THE SUBMISSIONS OF THE ASSESSEE FOR QUASHING THE PENALTY LEVIE D U/S.271B OF THE ACT. WE HOLD AND DIRECT ACCORDINGLY. 5. IN THE RESULT, THE IMPUGNED ORDER IS SET ASIDE AND A PPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON TUESDAY, THE 06 TH DAY OF NOVEMBER, 2018. SD/- SD/- R. S. SYAL VIKAS AWA STHY VICE-PRESIDENT JUDICIAL MEMBER / PUNE; / DATED : 06 TH NOVEMBER, 2018 SB 4 ITA NO.2304 /PUN/2016 A.Y.2011-12 !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT(APPEALS), PUNE-5. 4. THE PR. CIT, PUNE-4, PUNE. 5. '#$ %%&' , ( &' , )*+ , / DR, ITAT, A BENCH, PUNE. 6. $,- ./ / GUARD FILE. // TRUE COPY // (0 / BY ORDER, %1 &+ / PRIVATE SECRETARY ( &' , / ITAT, PUNE.