M/s Gopika Dairy Farms, Cochin V. DCIT, Ernakulam

ITA 447/COCH/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58237 (ITAT-COCHIN)
• Duration Of Justice: 1 year(s) 6 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 21-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S PRAVEEN
• Assessee Lawyers: R KRISHNA IYER
• Keywords: Reasonable cause; Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI SANJAY ARO RA (AM) I.T.A. NO.447/COCH/2010 (ASSESSMENT YEAR 2005-06) M/S GOPIKA DAIRY FARMS VS THE DY.CIT, CIR.2(2) 49/1965, BTS ROAD ERNAKULAM EDAPPALLY, KOCHI-682 024 PAN : AADFG5031C (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R KRISHNA IYER RESPONDENT BY : SHRI S PRAVEEN DATE OF HEARING : 25-01-2012 DATE OF PRONOUNCEMENT : 02-02-2012 O R D E R PER N.R.S. GANESAN (JM) THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF CIT(A)-II, KOCHI DATED 17-05-2010 CONFIRMING THE LEVY OF PENAL TY U/S 271B OF THE ACT. 2. SHRI R KRISHNA IYER, THE LD.REPRESENTATIVE FOR T HE ASSESSEE SUBMITTED THAT THE DUE DATE FOR GETTING THE AUDIT REPORT IS 31-10- 2005. THE ASSESSEE, HOWEVER, OBTAINED THE AUDIT REPORT ON 01-03-2007 AND FILED T HE SAME ALONGWITH THE RETURN OF INCOME ON 13-03-2007. THEREFORE, THERE WAS A DE LAY OF 17 MONTHS. ACCORDING TO THE LD.REPRESENTATIVE, THE ASSESSEE HA S FILED THE RETURN OF INCOME ALONG WITH THE AUDIT REPORT WHICH WOULD AMOUNT TO C OMPLYING WITH THE PROVISIONS OF THE ACT. THE LD.REPRESENTATIVE PLACED HIS RELIA NCE ON THE DECISION OF THIS TRIBUNAL IN ACIT VS MUTHOOT BUILDERS IN ITA NO.393/ COCH/1999 DATED 28 TH OCTOBER, 2002 AND THE JUDGMENT OF THE APEX COURT IN THE CASE OF COLLECTOR, LAND ACQUISITION VS MST KATTIJI & ORS (1987) 167 ITR 471 (SC) AND THE DECISION OF THE AHMEDABAD BENCH OF THIS TRIBUNAL IN AJITBHAI & CO ( 1993) 47 TTJ 22 (AHD). ITA 447/COCH/2010 2 3. ON THE CONTRARY, SHRI S PRAVIN, THE LD.REPRESENT ATIVE FOR THE REVENUE SUBMITTED THAT THERE WAS NO REASONABLE CAUSE IN NOT FILING THE AUDIT REPORT WITHIN THE TIME PRESCRIBED. THEREFORE, THE ASSESSING OFFI CER HAS RIGHTLY LEVIED THE PENALTY. THE LD.DR SUBMITTED THAT HE IS PLACING RE LIANCE ON THE OBSERVATIONS MADE BY THE CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. ADMITTEDLY THERE WAS A DELAY OF 17 MONTHS IN GETTING THE ACCOUNTS AUDITED. IT APPEARS THAT THE ASSESSEE EXPLAINED BEFORE THE LOWER AUTHORITIES THAT THE ACCOUNTANT OF THE ASSESS EE EXPIRED ON 06-07-2006. THEREFORE, THE DEATH OF THE ACCOUNTANT WAS THE REAS ON FOR NOT GETTING THE ACCOUNTS AUDITED IN TIME. THE FACT REMAINS IS THAT THE ASSESSEE GOT THE ACCOUNTS AUDITED ON 01-03-2007 AND THE SAME WAS FILED ALONG WITH THE REVISED RETURN OF INCOME ON 13-03-2007 I.E. BEFORE COMPLETION OF THE ASSESSMENT. IT IS WELL SETTLED PRINCIPLES OF LAW THAT FILING THE AUDIT REPORT IS M ANDATORY WHEREAS THE TIME LIMIT FOR FILING THE AUDIT REPORT IS ONLY DISCRETIONARY. THE VERY PURPOSE OF AUDIT REPORT IS ONLY TO ASSIST THE ASSESSING OFFICER TO ASSESS THE CORRECT TAXABLE INCOME OF THE ASSESSEE. WHEN THE AUDIT REPORT WAS FILED BEFORE T HE COMPLETION OF THE ASSESSMENT, THE PURPOSE AND THE LEGISLATIVE INTENT IS ACHIEVED. SINCE THE ASSESSEE HAS FILED THE AUDIT REPORT ALONG WITH THE RETURN OF INCOME ON 13-03-2007 BEFORE COMPLETION OF ASSESSMENT, THIS TRIBUNAL IS O F THE OPINION THAT THIS IS NOT A FIT CASE FOR LEVY OF PENALTY U/S 271B OF THE ACT. ACCORDINGLY THE ORDERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE PENALTY LEV IED U/S 271B IS DELETED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 02 ND THE DAY OF FEBRUARY, 2012 SD/- SD/- (SANJAY ARORA) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 2 ND FEBRUARY, 2012 PK/- ITA 447/COCH/2010 3 COPY TO: 1. M/S GOPIKA DAIRY FARMS, 49/1965, BTS ROAD, EDAPA LLY, KOCHI-682 024 2. THE DY.CIT, CIR.2(2), ERNAKULAM 3. THE CIT(A)-II, KOCHI 4. THE CIT, KOCHI 5. THE DR, ITAT (TRUE COPY) BY ORDER ASSTT.REGISTRAR, ITAT, COCHIN BENCH