Tarakeshwar Thana Samabay Krishi Bipanan Samity Ltd., Kolkata V. A.C.I.T.-Circle-I, Kolkata, Hooghly

ITA 2556/KOL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4781 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 7 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2016
• Appeal Filed By: Assessee
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 08-11-2013
• Court: TRIBUNAL
• Department Lawyers: MD GHYAS UDDIN JCIT LD
• Assessee Lawyers: V N PUROHIT
• Keywords: Reasonable cause

Judgement Text

ITA NO.2556/KOL/2013-C-JM M/S. TARAKESHWAR THANA SAMABAY KRISHI BIPANAN SAMITY LTD 1 IN THE INCOME TAX APPELLATE TRIBUNAL, C BENCH, K OLKATA BEFORE : SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI S.S VISWANETHRA RAVI, JUDICIAL MEMBE R I.T.A NO. 2556/KOL/2013 A.Y : 2009-10 TARAKESHWAR THANA SAMABAY VS. A.C.I.T, CIR-1, HOO GHLY KRISHI BIPANAN SAMITY LTD PAN: AAAAT6661P (APPELLANT) (RESPON DENT) FOR THE APPELLANT/ASSESSEE : S/SHRI V. N PUROHIT, FCA & H ARSH VARDHAN BHARADWAJ, CA, LD. ARS FOR THE RESPONDENT/DEPARTMENT: MD. GHYAS UDDIN , JCIT, LD. SR.DR DATE OF HEARING: 08-06-2016 DATE OF PRONOUNCEMENT: 10 -06 - 2016 ORDER SHRI S.S VISWANETHRA RAVI, JM THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER CIT(A)- XXXVI, KOLKATA DATED 12-8-2013 FOR THE ASSESSMENT Y EAR 2009-10, WHEREBY HE CONFIRMED THE PENALTY OF RS. 52,920/- IMPOSED BY T HE ASSESSING OFFICER U/S. 271B OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFER RED TO AS THE ACT). 2. THE ASSESSEE IN THE PRESENT CASE IS A COOPERATIV E SOCIETY. THE TAX AUDIT REPORT AS REQUIRED BY THE PROVISIONS OF SECTION 44A B OF THE ACT WAS FILED BY IT ALONG WITH ITS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ON 30.03.2010 AS AGAINST THE SPECIFIED DATE OF 30.09.2009. THE AS SESSING OFFICER, THEREFORE, INITIATED PENALTY PROCEEDINGS UNDER SECTION 271B OF THE ACT AND IN REPLY TO THE SHOW-CAUSE NOTICE ISSUED DURING THE COURSE OF SAID PROCEEDINGS, THE ASSESSEE- ITA NO.2556/KOL/2013-C-JM M/S. TARAKESHWAR THANA SAMABAY KRISHI BIPANAN SAMITY LTD 2 SOCIETY EXPLAINED THAT THE SENIOR AUDITOR APPOINTE D BY THE COOPERATIVE DEPARTMENT TO CONDUCT STATUTORY AUDIT COULD COMPL ETE THEIR AUDIT ONLY ON 29- 01-2010. IT WAS SUBMITTED THAT THE ASSESSEE-SOCIET Y THEREAFTER APPOINTED TAX AUDITOR, WHO IN TURN SUBMITTED HIS AUDIT REPORT ON 27-03-2010, WHICH WAS FILED ON 30-03-2010 ALONG WITH THE RETURN OF INCOME FOR T HE YEAR UNDER CONSIDERATION. IT WAS CONTENDED THAT THE FAILURE TO FURNISH THE TAX AUDIT REPORT BEFORE THE SPECIFIED DATE OF 30-09-2009, THEREFORE, WAS FOR S UFFICIENT CAUSE AND A REQUEST WAS MADE TO DROP THE PENALTY PROCEEDINGS INITIATED U/S. 271B OF THE ACT. THIS EXPLANATION OF THE ASSESSEE WAS NOT FOUND ACCEPTABL E BY THE ASSESSING OFFICER. ACCORDING TO HIM, THE ASSESSEE-SOCIETY COULD HAVE A PPOINTED THE TAX AUDITOR AND COULD HAVE GOT THE TAX AUDIT DONE INDEPENDENTL Y MUCH BEFORE THE SPECIFIED DATE 30-09-2009 AND THE DELAY IN STATUTORY AUDIT U NDER THE COOPERATIVE ACT HAD NO RELEVANCE WITH ITS FAILURE TO OBTAIN AND FURNI SH THE TAX AUDIT REPORT BY THE SPECIFIED DATE. HE, THEREFORE, REJECTED THE EXPLANA TION OF THE ASSESSEE AND PROCEEDED TO IMPOSE THE PENALTY OF RS.52,920/- U/S. 271B OF THE ACT. 3. THE PENALTY IMPOSED BY THE ASSESSING OFFICER UND ER SECTION 271B WAS CHALLENGED BY THE ASSESSEE IN THE APPEAL BEFORE THE CIT(A) AND THE SUBMISSION MADE BEFORE THE ASSESSING OFFICER WAS REITERATED ON BEHALF OF THE ASSESSEE BEFORE THE CIT(A) IN SUPPORT OF ITS CASE. THE CIT(A), HO WEVER, DID NOT FIND MERIT IN THE SAME AND PROCEEDED TO CONFIRM THE PENALTY IMP OSED BY THE ASSESSING OFFICER FOR THE FOLLOWING REASONS GIVEN IN PARAGRAP H 5.1 OF HIS IMPUGNED ORDER:- 5.1 HOWEVER IN THE PRESENT CASE, THERE IS NO EVI DENCE OF ANY EFFORT AT ALL TO GET THE ACCOUNT AUDITED AND TO ENS URE TIMELY FILING OF RETURN. EVEN AFTER OBTAINING THE AUDIT REPORT IN J ANUARY, THE RETURN HAS BEEN FILED TOWARDS END OF MARCH. AS PER CLAUSE (A) OF SECTION 44AB, THE ASSESSEE WAS OBLIGED TO GET ITS ACCOUNT A UDITED BY AN ACCOUNTANT. UNDER SECTION 271B OF THE ACT, THE FAIL URE TO ACCOUNTS AUDITED OR FURNISH THE REPORT AS REQUIRED U/S.44AB, ATTRACTS ITA NO.2556/KOL/2013-C-JM M/S. TARAKESHWAR THANA SAMABAY KRISHI BIPANAN SAMITY LTD 3 PENALTY. BUT PENALTY IS NOT IMPOSABLE U/S. 273B, IF THE ASSESSEE IS ABLE TO SHOW THAT THERE WAS A REASONABLE CAUSE FOR SUCH FAILURE. THE ONUS IS ON THE ASSESSEE TO PROVE THAT THERE WAS A REASONABLE CAUSE FOR SUCH FAILURE. 4. AGGRIEVED BY THE ORDER OF THE CIT(A), THE ASSESS EE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. THE LD.AR RELIED ON THE ORDER DT. 03-06-2016 OF C BENCH, KOLKATA TRIBUNAL IN ITA NO. 2396/KOL/201. 5. THE LD. DR SUBMITTED THAT DURING THE COURSE OF H EARING THE A/R OF THE ASSESSEE WAS ASKED TO PRODUCE ALL CORRESPONDENCE MA DE BY THE ASSESSEE WITH THE CO-OPERATIVE DEPARTMENT TO ENSURE THAT THE AUDIT I S ONE WITH THE SPECIFIED DATE. HOWEVER, THE A/R HAS BEEN UNABLE TO PROVIDE ANY COR RESPONDENCE OR OTHER EVIDENCE TO SHOW THAT ANY EFFORT WAS MADE BY THE AS SESSEE TO ENSURE THAT THE AUDIT WAS DONE BY THE SPECIFIED DATE. IT HAS MEREL Y BEEN STATED THAT NO CORRESPONDENCE AS TO APPOINTMENT OF AUDITOR IS NEE DED OR DONE. FURTHER, WHILE THE AUDIT BY CO-OPERATIVE DEPARTMENT WAS DONE ON 29 -01-2010, THE FORM NO. 3CB & 3CD WAS OBTAINED FROM A CHARTERED ACCOUNTANT ON 27-07-2010, AFTER ABOUT TWO MONTHS DELAY. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. AS RIGHTLY POINTED OUT BY THE LD. AR, THAT THIS TRIBUNAL DECIDED THE SAME ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING THAT THE DELAY CAUSED IN OBTAINING AND FILING THE AUDIT REPORT WAS BEYOND THE CONTROL OF ASSESSEE. THE RELEVANT PORTION PARA 4 OF SAID ORDER DATED 03-06-2016 IN THE CASE O F SUPRA IS REPRODUCED HEREIN BELOW FOR THE SAKE OF CLARITY:- 4. WE HAVE HEARD BOTH THE SIDES AND ALSO PERUSED TH E RELEVANT MATERIAL AVAILABLE ON RECORD. AS SUBMITTED ON BEHAL F OF THE ASSESSEE BEFORE THE AUTHORITIES BELOW AS WELL AS BEFORE US, ITS FAILURE TO OBTAIN ITA NO.2556/KOL/2013-C-JM M/S. TARAKESHWAR THANA SAMABAY KRISHI BIPANAN SAMITY LTD 4 AND FURNISH THE TAX AUDIT REPORT BY THE SPECIFIED D ATE OF 30.09.2009 AS PER THE REQUIREMENT OF SECTION 44AB WAS DUE TO DELA Y IN COMPLETION OF STATUTORY AUDIT BY THE AUDITORS APPOINTED BY THE CO OPERATIVE DEPARTMENT. SINCE THE STATUTORY AUDITOR UNDER THE C OOPERATIVE ACT WAS TO BE APPOINTED BY THE COOPERATIVE DEPARTMENT A ND SUCH APPOINTMENT AS WELL AS CONDUCT AND COMPLETION OF AU DIT BY THE STATUTORY AUDITOR WAS BEYOND THE CONTROL OF THE ASS ESSEE, WE FIND MERIT IN THE CONTENTION OF THE ID. COUNSEL OF THE ASSESSE E THAT THE DELAY IN COMPLETION OF STATUTORY AUDIT, WHICH CAUSED THE FAI LURE OF THE ASSESSEE TO OBTAIN AND FURNISH THE TAX AUDIT REPORT UNDER SE CTION 4AB, WAS DUE TO THE REASONS BEYOND THE CONTROL OF THE ASSESSEE A ND THE SAME CONSTITUTED THE SUFFICIENT CAUSE FOR ITS FAILURE TO COMPLY WITH THE REQUIREMENT OF SECTION 44AB. MOREOVER, THE TAX AUDI T REPORT OBTAINING BELATEDLY WAS FILED BY THE ASSESSEE ALONG WITH ITS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ON 05.01.2010 AND THE SAME, THEREFORE, WAS AVAILABLE TO THE ASSESSING OFFICER WHILE MAKING THE ASSESSMENT OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION. THE DEFAULT ON THE PART OF THE ASSESSEE IN OBTAINING AND FURNISHING THE TAX AUDIT REPORT BY THE SPECIFIED DATE THUS WAS TECHNICAL OR VENIAL IN NATU RE. HAVING REGARD TO ALL THESE FACTS AND CIRCUMSTANCES OF THE CASE, WE A RE OF THE VIEW THAT IT IS NOT A FIT CASE TO IMPOSE PENALTY UNDER SECTION 2 71B AND CANCELLING THE PENALTY SO IMPOSED BY THE ASSESSING OFFICER AND CONFIRMED BY THE LD. CIT(APPEALS), WE ALLOW THIS APPEAL OF THE ASSES SEE. 7. IN THE PRESENT CASE ALSO THE ASSESSEE COULD NOT OBTAIN AND FILE THE TAX AUDIT REPORT AS REQUIRED U/S. 44AB OF THE ACT DUE TO DELA Y IN COMPLETION OF STATUTORY AUDIT BY THE AUDITORS APPOINTED BY THE COOPERATIVE DEPARTMENT. THE ASSESSEE FILED THE TAX AUDIT REPORT IMMEDIATELY AFTER GETTIN G /AND OBTAINING THE SAME FROM M/S. GHOSAL & GHOSAL IN FORM NO.3CA ON 30-03-2010. WE FIND THAT THE ISSUE ON HAND IS SIMILAR TO THAT LATEST ORDER DATED 03-0 6-2016 BY THE TRIBUNAL PASSED IN ITA NO.2396/KOL/2013 IN THE CASE OF SUPRA. FOLLOWING THE SAME, WE ARE OF THE VIEW THAT IT IS NOT A FIT CASE TO IMPOSE THE PE NALTY OF RS.52,920/- U/S. 271B OF THE ACT. THEREFORE, WE CANCEL THE PENALTY IMPOSE BY THE AO AND CONFIRMED BY THE CIT(A). THE GROUND RAISED BY THE ASSESSEE IS AL LOWED. ITA NO.2556/KOL/2013-C-JM M/S. TARAKESHWAR THANA SAMABAY KRISHI BIPANAN SAMITY LTD 5 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. THIS ORDER IS PRONOUNCED IN OPEN COURT ON 10 /06 /2016 COPY OF THE ORDER FORWARDED TO: 1.. THE APPELLANT/ASSESSEE : M/S. TAREKESHWAR THAN A SAMABAY KRISHI BIPANAN SAMITY LTD C/O V.N PUROHIT & CO, CHARTERED ACCOUNTANTS, DI AMOND CHAMBERS, UNIT-III, 4 TH FLOOR, SUIT NO.4G, 4 CHOWRINGHEE LANE, KOLKATA-700 016. 2 THE RESPONDENT/DEPARTMENT: THE ASSTT. COMMISSIO NER OF INCOME TAX CIRCLE-I, AAYKAR BHAWAN, G.T ROAD, KHADINAMORE, P.O CHINSURAH, DIST:HOOGHLY PIN 712101. 3 4.. /THE CIT, /THE CIT(A) 5. DR, KOLKATA BENCH 6. GUARD FILE. TRUE COPY, BY ORDER, ASSTT REGISTRAR ** PRADIP SPS SD/- WASEEM AHMED, ACCOUNTANT MEMBER SD/- S.S VISWANETHRA RAVI, J JU DICIAL MEMBER DATE 10/06 /2016