Smt. Purnima Sharma, Gwalior V. ITO -W 2(2) , Gwalior

ITA 322/AGR/2019

AI Insights

The case involves Smt. Purnima Sharma, who was engaged in the trading of potatoes during the assessment year 2009-10. The Income Tax Officer (ITO) reopened her case under section 148 of the Income Tax Act and noted discrepancies in the sales and purchases reported. The ITO initiated penalty proceedings under section 271A for not maintaining prescribed books of accounts as required under section 44AA, due to the non-production of bills and vouchers. The assessee appealed against the penalty, arguing that she had produced the necessary documents during the assessment proceedings. The CIT(A) upheld the penalty, leading to the current appeal before the Tribunal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 114077 (ITAT-AGRA)
• Duration Of Justice: 4 year(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 11-10-2023
• Assessment Year: 2009-2010
• Appeal Filed On: 30-09-2019
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, ‘SMC’: AGRA (Through Virtual hearing) BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No.322/AGR/2019 [Assessment Year: 2009-10] Smt. Purnima Sharma, 114, Sharad Vihar, City Centre, Gwalior (M.P.)-474011 Vs ITO, Ward-2(2), Aayakar Bhawan, City Centre, Gwalior, Madhya Pradesh-474011 PAN-AULPS4341H Assessee Revenue Assessee by None Revenue by Sh. Shailendra Srivastava, Sr. DR Date of Hearing 12.10.2023 Date of Pronouncement 18.10.2023 ORDER PER SHAMIM YAHYA, AM, This appeal by the assessee is directed against the order of the Ld. CIT(A), Gwalior, dated 16.04.2019 for the Assessment Year 2009-10. 2. The grounds of appeal reads as under:- “On the facts and in the circumstances of the case the learned CIT Appeal(s) was not justify in confirming the penalty of Rs.25,000/- levied u/s 271A. The above penalty may kindly be deleted.” 3. Brief facts of the case are that the assessee was engaged in the trading of sale and purchase of POTATO during the year consideration. This case was reopened by issue of notice u/s 148 of the I.T. Act. During the reassessment proceeding, it was noticed by the AO that total sales shown by the assessee was Rs.7,22,56,800/- as against purchase of Rs.7,02,75,625/-. During the assessment proceedings, the assessee was 2 ITA No.322/AGR/2019 asked to produce all the books of accounts alongwith bills/vouchers pertaining to purchase & sales. However, in response the assessee failed to produce any bills/vouchers relating to purchases and sales made during the year consideration. Since the turnover shown by the assessee exceeds the prescribed limit for maintenance of books of account as prescribed in the provision of section 44AA of the Income Tax Act, but the assessee failed to do so. Due to this reason, the AO initiated penalty proceedings u/s 271A for failure of assessee to maintain prescribed books of accounts and other documents as required u/s 44AA of the I.T. Act. In compliance of various statutory notices/show cause notices assessee failed to furnish any explanation, therefore, the AO imposed penalty of Rs.25,000 u/s 271A of the Act. 4. Against the above order, the assessee appealed before the Ld. CIT(A). 5. The Ld. CIT(A) noted following submissions of the assessee:- “In defense the appellant has mainly contended that during assessment proceedings the assessee produced books of accounts, bills/vouchers for verification on 02.11.2017 pertaining to sales and various other expenses debited to the P & L account. Therefore, in view of the above, ld. AR contended that it is clear that the assessee has maintained books of accounts and thereby penalty of section u/s 271A is not attracted. Ld. AR has also contended that ld. Assessing Officer did not initiated the penalty proceedings u/s 271A of the Act in the assessment order and in view of this, he pleaded for deletion of penalty.” 6. However, the ld. CIT(A) was not convinced. He upheld the order of the Assessing Officer. 7. Against this order, the assessee is in appeal before us. 3 ITA No.322/AGR/2019 8. We have heard the ld. DR and perused the records. None appeared on behalf of the assessee despite notices issued. We find that in this case books of accounts have been produced; however, the assessee could not produce Potato purchase and sale vouchers. Moreover, the Assessing Officer has also not initiated penalty in the assessment order in this regard. Hence, in our considered opinion, when the assessment has been framed u/s 144 of the Act and books of accounts were rejected further penalty u/s 271A is very rigorous. In our considered opinion and on the facts and circumstances of the case, the assessee should not be visited with the regours of penalty, hence, we set-aside the orders of the authorities below and decide the issue in favour of the assessee. 9. In the result, the appeal of the assessee stands allowed. Order pronounced in the open court on 18 th October, 2023. Sd/- Sd/- [ANUBHAV SHARMA] [SHAMIM YAHYA] JUDICIAL MEMBER ACCOUNTANT MEMBER Delhi; Dated: 18.10.2023. f{x~{tÜ f{x~{tÜf{x~{tÜ f{x~{tÜ Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi