Shri Periyakaruppan Chettiyar & Co., CHENNAI V. ITO, CHENNAI

ITA 2573/CHNY/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 4648 (ITAT-CHENNAI)
• Duration Of Justice: 8 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-05-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 03-05-2017
• Assessment Year: 2013-2014
• Appeal Filed On: 02-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTHJCIT
• Assessee Lawyers: S SRIDHAR
• Section: 273B; 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . . . , . , BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.2573/MDS/2016 / ASSESSMENT YEAR : 2013-14 M/S. PERIYAKARUPPAN CHETTIYAR & CO., C/O. S. SRIDHAR, NEW NO.14, OLD NO.82, FLAT NO.5, 1 ST AVENUE, INDIRA NAGAR, ADYAR, CHENNAI 600020. V. THE INCOME TAX OFFICER, NON CORPORATE WARD 5(4), CHENNAI. PAN:AAAFP6538Q ( /APPELLANT) ( /RESPONDENT) /APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE /RESPONDENT BY : SHRI A.V. SREEKANTH,JCIT /DATE OF HEARING : 03.05.2017 /DATE OF PRONOUNCEMENT : 08.05.2017 / O R D E R PER A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER : THIS APPEAL IS FILED BY THE ASSESSEE AGGRIEVED BY THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-5, CHENNAI IN ITA NO.141/CIT(A)-5/14-15 DATED 25.05.2016 FOR THE ASSE SSMENT YEAR 2013-14 PASSED U/S. 271B OF THE ACT. 2. THE ASSESSEE HAS RAISED SEVERAL GROUNDS IN ITS A PPEAL, HOWEVER, THE CRUX OF THE ISSUE IS THAT LD. CIT(A) H AD ERRED BY LEVYING PENALTY UNDER SEC. 271B OF THE ACT FOR NOT FURNISHING AUDIT 2 I.T.A. NO. 2573/MDS/2016 REPORT UNDER SECTION 44AB OF THE ACT WITHIN THE STI PULATED PERIOD PRESCRIBED UNDER THE ACT. 3. THE ASSESSEE IS A PARTNERSHIP FIRM ENGAGED IN TH E BUSINESS OF TRADING IN LEATHER, FILED ITS RETURN OF INCOME F OR THE ASSESSMENT YEAR 2013-14 ADMITTING TOTAL INCOME OF RS.2,91,580/ - AGAINST THE TURNOVER OF RS.4,64,57,445/-. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS UNDER SECTION 143(3) OF THE ACT, LD.AO OBSERVED THAT THE ASSESSEE HAD NOT FURNISHED AUDIT REPORT UNDER S ECTION 44AB OF THE ACT. WHEN THE ASSESSING OFFICER QUERIED THE AS SESSEE EXPLAINED THAT THE CHARTERED ACCOUNTANT OF THE ASSE SSEE WAS UNABLE TO UPLOAD THE AUDIT REPORT DUE TO HIS ILL HEALTH. THE ASSESSEE HAD FURTHER REPLIED STATING THAT THE AUDIT REPORT WAS O BTAINED WITHIN THE DUE DATE PRESCRIBED UNDER THE ACT AND THE SAME WAS FILED ELECTRONICALLY ON 20.11.2014. HOWEVER, THE LD.AO L EVIED PENALTY U/S.271B OF THE ACT, BECAUSE THE ASSESSEE HAD NOT F ILED THE AUDIT REPORT WITHIN THE DUE DATE. ON APPEAL THE LD.CIT(A ) AGREEING WITH THE VIEW OF THE LD.AO CONFIRMED HIS ORDER. 4. AT THE OUTSET, THE LD.AR POINTED OUT THAT THE CH ENNAI BENCH OF THE TRIBUNAL IN ITA NO.2102/MDS/2016 IN THE CASE OF MRS. MUTHURAJAN PADMAVATHI FOR THE ASSESSMENT YEAR 2013-14 VIDE 3 I.T.A. NO. 2573/MDS/2016 ORDER DATED 10.01.2017 HAD CONDONED THE DELAY IN FI LING THE AUDIT REPORT AND THEREBY DIRECTED THE LD.AO TO DELETE THE PENALTY LEVIED U/S.271B OF THE ACT IN SIMILAR CIRCUMSTANCES. THER EFORE IT WAS PLEADED THAT IN THE CASE OF THE ASSESSEE ALSO RELIE F MAY BE GRANTED. THE LD.DR IN OTHER HAND ARGUED IN SUPPORT OF THE OR DERS OF THE REVENUE. 5. WE HAVE HEARD THE RIVAL SUBMISSION AND CAREFULLY PERUSED THE MATERIAL ON RECORD. WE FIND MERIT IN THE SUBMIS SION OF THE LD.AR. IN SOMEWHAT SIMILAR CIRCUMSTANCES ON EARLIE R OCCASION, THE CHENNAI BENCH OF THE TRIBUNAL IN THE ORDER CITED HE REIN ABOVE HAD DELETED THE PENALTY LEVIED U/S.271B OF THE ACT. TH E RELEVANT PORTION OF THE ORDER IS EXTRACTED HEREIN BELOW FOR REFERENC E: 7.WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULL Y PERUSED THE MATERIALS ON RECORD. FROM THE FACTS OF THE CASE, IT APPEARS THAT THERE IS NO MUCH MERIT IN THE CONTENTION OF THE LEARNED A UTHORIZED REPRESENTATIVE. AS STATED BY THE LEARNED COMMISSION ER OF INCOME TAX (APPEALS) IN HIS ORDER, THE CDBT VIDE CIRCULAR NO.F.225/117/2013/ITA.II DATED 26.09.2013 HAD ALLOW ED THE ASSESSEE TO FILE THE TAX REPORT MANUALLY WITH THE JURISDICTI ONAL OFFICER WITHIN THE DUE DATE OF FILING OF RETURN AND THEREAFTER TO FILE THE SAME ELECTRONICALLY ON OR BEFORE 31.10.2013. HOWEVER, TH E ASSESSEE HAS FAILED TO DO SO AND ONLY E-FILED THE AUDIT REPORT O N 13.01.2015 I.E., AFTER THE ISSUE OF NOTICE OF PENALTY UNDER SECTION 271B OF THE ACT. HOWEVER, FROM FURTHER PERUSING THE MATTER, IT APPEA RS THAT THE ASSESSEE HAS ENTRUSTED THE COMPLIANCE WITH HIS AUTH ORIZED REPRESENTATIVES AND THEY HAVE FAILED TO COMPLY WITH THE MANDATORY 4 I.T.A. NO. 2573/MDS/2016 REQUIREMENTS. IN THIS SITUATION, IT WOULD BE HARSH TO LEVY PENALTY ON THE ASSESSEE WHO APPEARS TO BE A SMALL TIME TRADER. THE REFORE IN THE INTEREST OF JUSTICE INVOKING OUR POWERS UNDER SECTI ON 273B OF THE ACT WE HEREBY DIRECT THE LEARNED ASSESSING OFFICER TO D ELETE THE PENALTY LEVIED UNDER SECTION 271B OF THE ACT IN THE CASE OF THE ASSESSEE. 6. SINCE THE FACTS OF THE CASE OF THE ASSESSEE IS S OMEWHAT SIMILAR TO THE FACTS OF THE CASE CITED BY THE LD.AR , WE DO NOT HAVE ANY HESITATION TO FOLLOW THE SAME DECISION RENDERED BY US ON THE EARLIER OCCASION. ACCORDINGLY WE HEREBY DIRECT THE LD.AO TO DELETE THE PENALTY LEVIED U/S.271B OF THE ACT IN THE CASE OF THE ASSESSEE. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE COURT ON 08 TH MAY, 2017 AT CHENNAI. SD/- SD/- ( . . . ) (N.R.S. GANESAN) /JUDICIAL MEMBER ( . ) (A. MOHAN ALANKAMONY) / ACCOUNTANT MEMBER /CHENNAI, /DATED, THE 08 TH MAY, 2017. JR. ! ' ! /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. #$% () /CIT(A) 4. #$% /CIT, 5. ! /DR 6. &' /GF.