Shri Mohan Vasantha Kumaresan, CHENNAI V. ITO, CHENNAI

ITA 3068/CHNY/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 7500 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-03-2017
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 02-11-2016
• Court: TRIBUNAL
• Department Lawyers: C YAMUNA
• Assessee Lawyers: A S SRIRAMAN
• Section: 139

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: CHENNAI . . . , ! '#.. $ %!& , ( )* BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D.S.SUNDER SINGH, ACCOUNTANT MEMBER ! ./ ITA NO.3068/MDS/2016 + ,+ /ASSESSMENT YEAR: 2013-14 SHRI MOHAN VASANTHA KUMARESAN, NO.12, KAMARAJ PARK STREET, ROYAPURAM, CHENNAI-600 013. VS. THE INCOME TAX OFFICER, NON-CORPORATE WARD-5(1), CHENNAI. [PAN: AACPK 6777 G ] ( -. /APPELLANT) ( /0-. /RESPONDENT) -. 1 2 / APPELLANT BY : MR.A.S.SRIRAMAN, ADVOCATE /0-. 1 2 /RESPONDENT BY : MR.C.YAMUNA, JCIT $ 1 3( /DATE OF HEARING : 31.01.2017 45, 1 3( /DATE OF PRONOUNCEMENT : 17.03.2017 / O R D E R PER D.S.SUNDER SINGH , ACCOUNTANT MEMBER : THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER DATED 07.09.2016 OF COMMISSIONER OF INCOME TAX (APPEALS)- 5, CHENNAI, IN ITA NO.129/CIT(A)-5/15-16 FOR THE AY 2013-14. ITA NO.3068/MDS/2016 :- 2 -: 2.0 ALL THE GROUNDS OF THE APPEAL ARE RELATED TO THE P ENALTY LEVIED BY THE ASSESSING OFFICER (IN SHORT AO) U/S.271B OF INCOM E TAX ACT (IN SHORT THE ACT). THE ASSESSEE FILED THE RETURN OF INCOME ELEC TRONICALLY ON 26/10/2013 ADMITTING THE TOTAL INCOME OF RS.9,81,870/-. THE AS SESSEE REQUIRED TO GET HIS ACCOUNTS AUDITED AND OBTAIN THE AUDIT REPORT U/ S.44AB OF INCOME TAX ACT. THE AO FOUND THAT THE ASSESSEE HAS NOT FURNISH ED THE AUDIT REPORT U/S.44AB BEFORE THE AO BEFORE THE DUE DATE. THEREF ORE, THE AO INITIATED PENALTY U/S.271B AND CALLED FOR THE EXPLANATION OF THE ASSESSEE. THE ASSESSEE EXPLAINED THAT THE AUDIT WAS COMPLETED AND OBTAINED THE AUDIT REPORT, THE ASSESSEE EXPLAINED BEFORE THE AO AS UND ER: THE ASSESSEE IN HIS LETTER DATED 14.10,2015 STATED THAT IT WAS NOT MY INTENTION TO VIOLATE ANY OF THE PROV ISIONS OF THE INCOME TAX ACT AND THAT THE ACCOUNTS WERE AUDITED U/S.44AB OF THE INCOME TAX AC T, 1961 AND FOR THE YEAR UNDER CONSIDERATION, MY ACCOUNTS WAS AUDITED U/S.44AB OF THE INCOME TAX ACT AND OBTAINED FORM-3CB & 3CD REPORT DATED 30.09.2013. BASED ON TH E AUDIT REPORT, I HAVE ALSO FILED THE RETURN OF INCOME ON 26.10.2013. MOREOVER, FOR THE Y EAR UNDER CONSIDERATION, IT WAS FOR THE FIRST TIME THE TAX AUDIT REPORT HAD TO BE FILED ONL INE AND IT IS TECHNICAL ASPECT. THE REPORT WAS NOT ABLE TO BE FILED EVEN AFTER REPEATED ATTEMP TS AS THERE WERE LOTS OF DIFFICULTIES. THE SAID FORMS WERE MODIFIED MORE THAN 12 TIMES WHICH C REATED THE PROBLEM IN FILING. AFTER COMING TO MY KNOWLEDGE THAT THE AUDIT REPORT WAS NO T E-FILED, I HAVE TAKEN STEPS AND APPROACHED MY AUDITOR AND THEY HAVE ALSO FILED THE AUDIT REPORT ON 12.03.2015. AS THE FAULT IS A TECHNICAL NATURE AND FILING THE REPORT I S BEYOND MY CONTROL AND AS IT WAS NO FAULT OF HIM, I REQUEST NOT TO LEVY PENALTY U/S.271B OF T HE INCOME TAX ACT, 1961. 3.0 THE AO DID NOT ACCEPT THE EXPLANATION OF THE ASSES SEE AND IMPOSED THE PENALTY OF RS.1,50,000/- U/S.271B OF THE ACT @ 0.25% OF SALES. 4.0 AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE WEN T ON APPEAL BEFORE THE LEARNED COMMISSIONER OF INCOME TAX (APPE ALS) (HEREINAFTER REFERRED TO AS LD.CIT(A)) AND THE LD.CIT(A) CONFI RMED THE PENALTY IMPOSED BY THE AO AND HENCE THE ASSESSEE IS IN APPE AL BEFORE US. ITA NO.3068/MDS/2016 :- 3 -: 5.0 APPEARING FOR THE ASSESSEE, THE LEARNED AUTHORIZE D REPRESENTATIVE (HEREINAFTER REFERRED TO AS LD.AR) ARGUED THAT THE AUDIT IN THE ASSESSEES CASE WAS COMPLETED BEFORE THE DUE DA TE I.E. 30.09.2013 AND THE ASSESSEE OBTAINED THE AUDIT REPORT BEFORE T HE DUE DATE AND ON THE BASIS OF AUDIT REPORT THE RETURN OF INCOME WAS FILED ON 26.10.2013 ELECTRONICALLY. THE ASSESSEE FILED RETURN OF INCOM E ON 26.10.2013 ELECTRONICALLY AND THE AUDIT REPORT WAS UPLOADED ON 12.03.2015. THE LD.AR FURTHER SUBMITTED THAT THE AUDIT REPORT COULD NOT BE UPLOADED BECAUSE OF SOFTWARE PROBLEM OF THE DEPARTMENT. IT WAS THE FIRST YEAR OF INTRODUCTION OF UPLOADING THE TAX AUDIT REPORT ONLI NE AND THERE WERE TECHNICAL BUGS CREPT IN THE SOFTWARE WHICH HINDERED THE UPLOADING OF TAX AUDIT REPORT AND HENCE THE ASSESSEE COULD NOT UPLO AD THE TAX AUDIT REPORT IN SPITE OF MAKING SEVERAL ATTEMPTS DUE TO REPEATED TECHNICAL PROBLEMS OCCURRED IN THE SOFTWARE OF THE DEPARTMEN T. FINALLY, AFTER MAKING SEVERAL ATTEMPTS, THE ASSESSEE COULD UPLOAD THE TAX AUDIT REPORT ON 12.03.2015. THE LD.AR ARGUED THAT FOR THE MIST AKE OF THE DEPARTMENT THE ASSESSEE SHOULD NOT BE PLACED IN ADVERSE POSITI ON. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPRESENTATIVE (HEREINAFTE R REFERRED TO AS LD.DR) ARGUED THAT THOUGH THERE WERE CERTAIN PROB LEMS IN UPLOADING THE TAX AUDIT REPORT ONLINE, THE CBDT HAS ISSUED DIREC TIONS U/S.119(2)(A) OF THE ACT TO FURNISH THE TAX AUDIT REPORT MANUALLY B EFORE THE JURISDICTIONAL AO BEFORE THE DUE DATE AS AN ALTERNATIVE REMEDY AND TO UPLOAD SUBSEQUENTLY ON OR BEFORE 31.10.2013. THE ASSESSEE HAS NEITHER FURNISHED THE TAX AUDIT REPORT MANUALLY NOR UPLOADE D BEFORE THE ITA NO.3068/MDS/2016 :- 4 -: PRESCRIBED DATE AND THERE WAS A DELAY IN FILING THE TAX AUDIT REPORT AND THIS IS A FIT CASE FOR LEVYING PENALTY U/S.271 OF T HE ACT. 6.0 WE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MAT ERIAL PLACED BEFORE US. ADMITTEDLY, IN THIS CASE, THE TAX AUDIT REPORT WAS UPLOADED ON 12.03.2015 AGAINST THE DUE DATE FOR FILING THE TAX AUDIT REPORT ON 30.09.2013. THE ASSESSEE STATED THAT THE AUDIT REP ORT WAS OBTAINED BEFORE 30.09.2013 BUT COULD NOT UPLOAD THE AUDIT RE PORT DUE TO TECHNICAL PROBLEMS IN UPLOADING THE AUDIT REPORT. HOWEVER, T HE CBDT HAS RELAXED THE NORMS FOR UPLOADING THE TAX AUDIT REPORT ELECTR ONICALLY AND ISSUED GUIDELINES TO FILE THE AUDIT REPORT BEFORE THE JURI SDICTIONAL AO BEFORE THE PRESCRIBED DUE DATE. FURTHER, THE CBDT ALSO CLARIF IED THAT THE AUDIT REPORT SHOULD BE FURNISHED ELECTRONICALLY ON OR BEF ORE 31.10.2013. FOR READY REFERENCE, WE RE-PRODUCE THE RELEVANT GUIDELI NES OF THE CBDT WHICH WAS DISCUSSED IN PAGE NO.1 OF THE PENALTY ORDER EXT RACTED FOR THE SAKE OF CONVENIENCE: AS PER THE GUIDELINES/INSTRUCTION F.NO.225/117/201 3/ITA.II DATED 26.9.2013 WHICH IS REPRODUCED AS FOLLOWS 'CBDT IN EXERCISE OF POWER U/ S.119(2)(A) OF THE I.T.ACT, 1961 READ WITH SEC.139 AND RULE 12. HAS DECIDED TO RELAX THE REQUIREMENT OF FURNISHING THE REPORT OF AUDIT ELECTRONICALLY AS PRESCRIBED UNDER THE PROVIS O TO SUB-RULE (2) OF RULE 12 OF THE IT RULES FOR THE ASSESSMENT YEAR 2013-14 AS UNDER- (A) THE ASSESSEES, WHO ARE PRESENTLY FINDING IT DIF FICULT TO UPLOAD THE PRESCRIBED REPORT OF AUDIT (AS REFERRED TO ABOVE) IN THE SYSTEM ELECTRON ICALLY MAY ALSO FURNISH THE SAME MANUALLY BEFORE THE JURISDICTIONAL ASSESSING OFFICER WITHIN THE PRESCRIBED DUE DATE (B) THE SAID REPORT OF AUDIT SHOULD HOWEVER BE FURN ISHED ELECTRONICALLY ON OR BEFORE 31.10.2013.' FURTHER VIDE CIRCULAR/INSTRUCTION/DIRECTION ISSUED BY CBDT IN NO. F. NO.225/117 / 2013/ITA.II DATED 24.10.2013 THE CBDT HAD INSTRUCTED VIDE ORDER U/S.119 OF THE INCOME TAX ACT, 1961 'IN EXERCISE OF POWERS CONFERRED U/S.119 OF THE INCOME-TAX ACT. 1961. THE CENTRAL BOARD DIRECT TAXES, IN CONTINUATION TO ORDER U/S119 DATED 26.09.2013 IN F. NO.225/117/2013/ITA.II, HEREBY DIRECTS THAT IN C ASES WHERE THE 'DUE DATE' OF FURNISHING REPORTS OF AUDIT AND CORRESPONDING INCOME-TAX RETUR N WAS 30 TH SEPTEMBER, 2013 SUCH ITA NO.3068/MDS/2016 :- 5 -: REPORTS OF AUDIT AND RETURNS OF INCOME SHALL BE DEE MED TO HAVE BEEN FURNISHED WITHIN THE 'DUE DATE PRESCRIBED UNDER SECTION 139 OF THE INCOM E TAX ACT 1961. 7.0 IN THE INSTANT CASE, THE DUE DATE FOR FURNISHING T HE TAX AUDIT REPORT WAS 30.09.2013 MANUALLY BEFORE THE AO AND ELECTRONI CALLY 31.10.2013. THE ASSESSEE HAS NEITHER FURNISHED THE RETURN BEFOR E THE AO WITHIN THE PRESCRIBED TIME LIMIT NOR UPLOADED ELECTRONICALLY B EFORE THE EXTENDED DATE OF 31.10.2013. THE TAX AUDIT REPORT WAS UPLOADED O NLY ON 12.03.2015 WITH A DELAY OF MORE THAN 16 MONTHS. THE LD.AR COU LD NOT JUSTIFY THE REASONS FOR DELAY IN UPLOADING THE REPORT AND ALSO DID NOT JUSTIFY THE REASON FOR NON-FURNISHING THE TAX AUDIT REPORT BEFO RE THE AO. THEREFORE, WE DO NOT FIND ANY ERROR IN THE CIT(A)S ORDER AND THE SAME IS UPHELD. 8.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH MARCH, 2017, AT CHENNAI. SD/- SD/- ( . . . ) (N.R.S. GANESAN) /JUDICIAL MEMBER ( '# . . $ %!& ) (D.S.SUNDER SINGH) ( /ACCOUNTANT MEM BER /CHENNAI, 6! /DATED: 17 TH MARCH, 2017. TLN 1 /3%7 87,3 /COPY TO: 1. -. /APPELLANT 4. $ 93 /CIT 2. /0-. /RESPONDENT 5. 7 : /3 /DR 3. $ 93 ( ) /CIT(A) 6. #+ = /GF