SHRI SOHAN NATH, AJMER V. INCOME TAX OFFICER, AJMER

ITA 888/JPR/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 3597 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 5 month(s)
• Appeal Type: Income Tax (International Taxation) Appeal
• Pronouncement Date: 29-04-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 28-11-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ROSHANTA MEENA
• Keywords: Business income; Initiation of penalty proceedings; Reasonable cause; Corroborative evidences; Non compliance; Competent authority; Revised return; Bonafide mistake
• Section: 273B; 142(1); 44BB; 139(1); 68; 11

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S,A JAIPUR JH JESK LH0 KEKZ] YS[KK LNL; ,OA JH FOT; IKY JKO] U;KF;D LNL; DS LE{K BEFORE: SHRI RAMESH. C. SHARMA, AM & SHRI VIJAY PA L RAO, JM VK;DJ VIHY LA- @ ITA NO. 888/JP/2017 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2013-14 SHRI SOHAN NATH, 84, NATH GAWADI, VILL: LADPURA, AJMER. CUKE VS. THE ITO, WARD-1(3) AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AFYPN 0276 J VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPON DENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI MAHENDRA GARGIEYA (ADV.) JKTLO DH VKSJ LS @ REVENUE BY : SMT. ROSHANTA MEENA (JCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 13/02/2019 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 06/03/2019 VKNS'K@ ORDER PER: VIJAY PAL RAO, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 14.08.2017 OF THE LD. CIT(A), AJMER ARISING FROM PE NALTY ORDER PASSED U/S 271B OF THE I.T. ACT FOR THE ASSESSMENT YEAR 20 13-14. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- 1. THE IMPUGNED PENALTY ORDER U/S 271B OF THE ACT DATED 28.09.2016 IS BAD IN LAW AND ON FACTS OF THE CASE, FOR WANT OF ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 2 JURISDICTION AND VARIOUS OTHER REASONS AND HENCE TH E SAME KINDLY BE QUASHED. 2. THE IMPUGNED PENALTY ORDER U/S 271B OF THE ACT D ATED 28.09.2016 IS BAD IN LAW AND ON FACTS OF THE CASE, IS BARRED BY LIMITATION HENCE, THE SAME KINDLY BE QUASHED. 3. RS. 68,944/-:- THE LD. CIT(A) ERRED IN LAW AS WE LL AS ON THE FACTS OF THE CASE IN CONFIRMING THE PENALTY U/S 271 B OF THE ACT OF RS. 68,944/-. THE PENALTY SO IMPOSED BY THE AO AND CONFIRMED BY THE LD. CIT(A) BEING TOTALLY CONTRARY TO THE PRO VISIONS OF LAW AND FACTS KINDLY BE DELETED IN FULL. 4. THE APPELLANT PRAYS YOUR HONOUR INDULGENCES TO A DD, AMEND OR ALTER OF OR ANY OTHER GROUNDS OF THE APPEAL ON OR B EFORE THE DATE OF HEARING. 2. THE ASSESSEE HAS E-FILED ITS RETURN OF INCOME FO R THE YEAR UNDER CONSIDERATION ON 12.07.2013 DECLARING TOTAL INCOME OF RS. 2,15,000/- FROM TRUCK HIRING BUSINESS. DURING THE COURSE OF AS SESSMENT PROCEEDINGS, THE AO AS NOTED THAT THE ASSESSEE HAS ALSO CARRIED OUT LIQUOR BUSINESS DURING THE YEAR UNDER CONSIDERATION BUT HAS NOT DECLARED ANY INCOME FROM THE LIQUOR BUSINESS. IN RE SPONSE TO THE NOTICE ISSUED U/S 142(1) OF THE ACT THE ASSESSEE FILED REV ISED RETURN OF INCOME ON 30.07.2015 AND DECLARED TOTAL INCOME OF RS. 6,38 ,900/-. THE ASSESSEE HAS SHOWN TOTAL SALES FROM LIQUOR BUSINESS AMOUNTING TO RS. ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 3 1,37,88,837/-. THE AO TREATED AS REVISED RETURN OF INCOME AS INVALID AND COMPLETED THE ASSESSMENT PROCEEDINGS ON THE BAS IS OF THE ORIGINAL RETURN OF INCOME. SUBSEQUENTLY, THE AO WHILE PASSIN G THE ASSESSMENT ORDER HAS ALSO RECORDED SATISFACTION THAT THE ASSES SEE HAS NOT COMPLIED WITH THE PROVISIONS OF SECTION 44AB OF THE ACT AND THEREFORE, IT IS FIT CASE FOR INITIATION OF PENALTY PROCEEDINGS U/S 271B OF THE ACT. THE AO ACCORDINGLY, INITIATED THE PENALTY PROCEEDINGS U/S 271B BY ISSUING NOTICE DATED 14.03.2016 AND THEREAFTER DATED 11.08.2019. T HERE WAS NO REPRESENTATION OR ATTENDANCE ON BEHALF OF THE ASSES SEE IN THE PENALTY PROCEEDINGS. ACCORDINGLY, THE AO PASSED THE IMPUGNE D ORDER BY HOLDING THAT THE ASSESSEE HAS FAILED TO GET HIS BOOKS OF AC COUNTS AUDITED WITHIN STIPULATED PERIOD AND AS REQUIRED U/S 44AB OF THE A CT AND CONSEQUENTLY PENALTY U/S 271B OF THE ACT BEING % OF TOTAL SALE WAS IMPOSED. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT(A) BUT COULD NOT SUCCEED. 3. BEFORE US, THE LD. AR OF THE ASSESSEE HAS SUBMIT TED THAT THE ASSESSES HAS MADE SUBSTANTIAL COMPLIANCE OF PROVISI ONS OF SECTION 44AB OF THE ACT WHEN THE ASSESSEE FILED THE AUDIT REPORT ALONG WITH REVISED RETURN OF INCOME DURING THE ASSESSMENT PROCEEDINGS. THE LD. AR HAS FURTHER SUBMITTED THAT THE ASSESSEE IS REGULAR BUSI NESS ACTIVITY IS TRUCK ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 4 HIRING AND LIQUOR BUSINESS WAS CARRIED OUT ONLY DUR ING THE YEAR UNDER CONSIDERATION AND THEREFORE, INADVERTENTLY THE ASSE SSEE HAS NOT DECLARED THE INCOME FROM LIQUOR BUSINESS WHILE FILI NG THE RETURN OF INCOME U/S 139(1). HOWEVER, DURING COURSE OF ASSESS MENT PROCEEDINGS THE ASSESSEE FILED A REVISED RETURN OF INCOME AND A LSO FILED THE AUDIT REPORT, THEREFORE, THE PURPOSE AND INTENT OF FILING THE AUDIT REPORT IS TO EXTENT HELP OF THE ASSESSING OFFICER WHILE COMPLETI NG THE ASSESSMENT PROCEEDINGS WAS JUSTIFIED. ONCE, THE ASSESSEE FILED THE AUDIT REPORT DURING THE ASSESSMENT PROCEEDINGS A SUBSTANTIAL COM PLIANCE WAS MADE AS REQUIRED U/S 44AB OF THE ACT. THE ASSESSEE HAS A LSO EXPLAINED THE REASONABLE CAUSE FOR NOT DISCLOSING THE INCOME FROM LIQUOR BUSINESS IN THE ORIGINAL RETURN OF INCOME AND THEREFORE, THE SA ID EXPLANATION OF THE ASSESSEE IS A VALID AND BONAFIDE IN TERMS OF SECTIO N 273B OF THE ACT. HE HAS ALSO SUBMITTED THAT THOUGH THE BOOKS OF ACCOUNT S OF THE ASSESSEE WERE AUDITED BY THE AUDITOR HOWEVER, DUE TO LACK OF COORDINATION BETWEEN THE AUDITOR AND THE TAX ADVOCATE THE INCOME FROM LIQUOR BUSINESS WAS NOT DECLARED IN THE RETURN OF INCOME. THUS, DUE TO THE INADVERTENC AND BONAFIDE MISTAKE, THE ASSESSEE COUL D NOT DECLARE LIQUOR BUSINESS INCOME AND ALSO DID NOT FILE THE AUDIT REP ORT. THUS, THE LD. AR OF THE ASSESSEE HAS SUBMITTED THAT WHEN THE TURNOVE R DECLARED BY THE ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 5 ASSESSEE IN THE ORIGINAL RETURN OF INCOME IS LESS T HAN THE LIMIT PRESCRIBED U/S 44AB OF THE ACT THEN, THERE WAS NO REQUIREMENT OF FILING THE AUDIT REPORT ALONG WITH THE RETURN OF INCOME. SUBSEQUENTL Y, WHEN THE ASSESSEE FILED THE REVISED RETURN OF INCOME ON A HI GHER TURNOVER THE ASSESSEE HAS ALSO FILED AUDIT REPORT IN COMPLIANCE OF THE PROVISIONS OF SECTION 44AB OF THE ACT. IN SUPPORT OF HIS CONTENTI ONS, HE HAS RELIED UPON THE DECISION OF HONBLE GAUHATI HIGH COURT IN CASE OF SURAJMAL PARSURAM TODI VS. CIT 222 ITR 691. 4. ON THE OTHER HAND, THE LD. DR HAS SUBMITTED THAT IT IS A CLEAR CASE OF DEFAULT COMMITTED BY THE ASSESSEE FOR NOT FILING OF THE AUDIT REPORT ALONG WITH RETURN OF INCOME. FURTHER, IT IS NOT A C ASE OF INADVERTENCE OR BONAFIDE MISTAKE BUT THE ASSESSEE HAS DELIBERATELY NOT DISCLOSED THE INCOME FROM LIQUOR BUSINESS AND ONLY WHEN THE AO IS SUED A SHOW NOTICE THE ASSESSEE FILED THE REVISED RETURN OF INC OME WHICH WAS NOT ACCEPTED BY THE AO AND THE SAME WAS TREATED INVALID . THEREFORE, THERE WAS NO COMPLIANCE ON THE PART OF THE ASSESSEE. EVEN DURING THE PENALTY PROCEEDINGS, THE ASSESSEE HAS FAILED TO FURNISH ANY EXPLANATION OR EVEN TO ATTEND THE PROCEEDINGS. THEREFORE, THE CASE OF T HE ASSESSEE DOES NOT FALL IN THE BONAFIDE EXPLANATION IN TERMS OF SECTIO N 271B OF THE ACT. HE HAS RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW . ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 6 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS RELEVANT MATERIAL ON RECORD. THE MAIN CONTENTION OF THE LD. AR IS THAT THE ASSESSEE FILED AUDIT REPORT DURING THE ASSESSMENT P ROCEEDINGS, THEREFORE, IT IS A SUBSTANTIAL COMPLIANCE OF SECTIO N 44AB OF THE ACT. WE FIND THAT THE ASSESSEE HAS FILED THE E-RETURN ON 12 .07.2013 BUT DID NOT DISCLOSE THE INCOME FROM LIQUOR BUSINESS. SUBSEQUEN TLY, ONLY WHEN THE AO ISSUED A SHOW CAUSE NOTICE U/S 142(1) OF THE ACT TO ASSESS THE INCOME FROM LIQUOR BUSINESS THE ASSESSEE FILED A RE VISED RETURN OF INCOME AND DECLARED INCOME FROM LIQUOR BUSINESS AS WELL AS TURNOVER OF THE LIQUOR BUSINESS AT RS. 1,37,88,837/-. THE ASSES SEE HAS ALSO FILED THE AUDIT REPORT DATED 05.09.2013. THUS, IT IS A CLEAR THAT AT THE TIME OF FILING THE RETURN OF INCOME ON 12.07.2013 THE AUDIT REPORT DATED 05.09.2013 WAS NOT IN EXISTENCE. SINCE, THE ASSESSE E E-FILED ITS RETURN OF INCOME, THEREFORE, IF THE INCOME FROM LIQUOR BUS INESS WOULD HAVE BEEN DECLARED IN THE ORIGINAL RETURN OF INCOME THEN , AS PER THE INCOME TAX RULES THE AUDIT REPORT WAS ALSO REQUIRED TO BE ANNEXED ALONG WITH THE RETURN OF INCOME. HOWEVER, THE ASSESSEE DID NOT DISCLOSE INCOME FROM LIQUOR BUSINESS AND CONSEQUENTLY HAS ALSO STAT ED IN THE RETURN OF INCOME THAT AUDIT REPORT IS NOT REQUIRED. THEREFORE , IT IS NOT THE CASE OF NON FILING OF THE AUDIT REPORT AT THE TIME OF FILIN G THE ORIGINAL RETURN OF ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 7 INCOME BUT THE SAID AUDIT REPORT WAS NOT IN EXISTEN CE ON THE SAID DATE OF FILING THE RETURN OF INCOME AND ONLY WHEN THE AS SESSING OFFICER HAS POINTED OUT AND ISSUE A SHOW CAUSE TO ASSESS THE IN COME FROM LIQUOR BUSINESS THE ASSESSEE CAME FORWARD WITH THE REVISED RETURN OF INCOME TO OFFER THE INCOME FROM LIQUOR BUSINESS AND THEN A LSO SOUGHT TO FILE THE AUDIT REPORT. AO WHILE PASSING THE ASSESSMENT ORDER TREATED THE REVISED RETURN AS INVALID AND COMPLETED THE ASSESSMENT ON T HE ORIGINAL RETURN OF INCOME. THUS, IT CANNOT BE A CASE OF INADVERTENCE A ND BANAFIDE MISTAKE OF NOT FILING THE AUDIT REPORT ALONGWITH RETURN OF INCOME BUT THE ASSESSEE HAS NOT EVEN THE DECLARED THE TURNOVER AND INCOME OF THE LIQUOR BUSINESS AT THE TIME OF FILING OF THE RETURN OF INCOME U/S 139(1) OF THE ACT. THE DECISION RELIED UPON THE LD. AR OF THE ASSESSEE IN CASE OF SURAJMAL PARSURAM TODI VS. CIT(SUPRA) IS ON THE POINT OF NOT FILING THE RETURN OF INCOME BUT IN THE SAID CASE THE ASSES SEE WAS NOT EVEN MAINTAINING THE BOOKS OF ACCOUNTS AND THEREFORE, TH E HONBLE HIGH COURT HAS HELD THAT WHEN THE ASSESSEE COMMITTED AN OFFENCE BY NOT MAINTAINING THE BOOKS OF ACCOUNT AS CONTEMPLATED U/ S 44AA OF THE ACT THE OFFENCE IS COMPLETED AND THEREFORE, THERE CANNO T BE POSSIBILITY OF ANY OFFENCE U/S 44AB OF THE ACT. IN THE CASE IN HAN D, THE ASSESSEE HAS STATED TO HAVE MAINTAINED THE BOOKS OF ACCOUNT BUT THERE WAS A ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 8 MISREPRESENTATION FOR NOT DISCLOSING THE INCOME AND TURNOVER FROM LIQUOR BUSINESS. THEREFORE, THE SAID DECISION WILL NOT HELP THE CASE OF THE ASSESSEE. FURTHER, THE ASSESSEE HAS NOT BOTHERE D TO PARTICIPATE IN THE PENALTY PROCEEDINGS AND TO FURNISH THE EXPLANAT ION FOR NOT FILING THE AUDIT REPORT AS CONTEMPLATED U/S 44AB OF THE ACT. T HE PROVISIONS OF SECTION 44AB OF THE ACT REQUIRES THE AUDIT REPORT T O BE FILED IN THE PRESCRIBED FORM ALONG WITH ROI BEFORE DUE DATE OF F ILING THE RETURN OF INCOME U/S 139(1) OF THE ACT. THE EXPLANATION 2 OF SECTION 44AB OF THE ACT HAS MADE IT CLEAR THAT THE AUDIT REPORT HAS TO BE FILED BEFORE THE DUE DATE OF RETURN OF INCOME U/S 139(1). SUBSEQUENT , FILING OF THE AUDIT REPORT IS NOT A COMPLIANCE OF THE PROVISIONS OF SEC TION 44AB OF THE ACT PARTICULARLY WHEN THE ASSESSEE HAS NOT DECLARED THE TURNOVER AND INCOME FROM LIQUOR BUSINESS. FURTHER, THE ALLEGED A UDIT REPORT WAS NOT IN EXISTENCE ON THE DATE OF FILING THE ORIGINAL RET URN OF INCOME. THEREFORE, IN THE ABSENCE OF ANY REASONABLE EXPLANA TION FOR NON COMPLIANCE OF THE PROVISIONS OF SECTION 44AB THE PE NALTY PROVISIONS OF SECTION 271B OF THE ACT ARE ATTRACTED. WE FORTIFY O UR VIEW BY THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN CA SE OF SHI RAM RAJARAM & PARTY VS. CCIT 281 CTR 214 WHEREIN THE HONBLE JU RISDICTIONAL HIGH ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 9 COURT HAS CONSIDERED AN IDENTICAL ISSUE AND HAS HEL D IN PARAS 18 TO 27 AS UNDER:- 18. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND HAVE PERUSED THE ORDERS PASSED BY ALL THE THREE AUTHORITIES. 19. TO APPRECIATE THE CONTROVERSY IN ALL THE THREE APP EALS, IT WOULD BE APPROPRIATE TO QUOTE SS. 44AB. 27IB AS ALSO 273B OF THE IT ACT. WHICH PROVIDE AD INFRA: 'SEC. 44AB. AUDIT OF ACCOUNTS OF CERTAIN PERSONS CA RRYING ON BUSINESS OR PROFESSIONEVERY PERSON. (A ) CARRYING ON BUSINESS SHALL, IF HIS TOTAL SALES, TUR NOVER OR GROSS RECEIPTS, AS THE CASE MAY BE. IN BUSINESS EXCEED OR EXCEEDS FORTY LAKH RUPEES IN ANY PREVIOUS YEAR: OR (B ) CARRYING ON PROFESSION SHALL, IF HIS GROSS RECEIPTS IN PROFESSION EXCEED TEN LAKH RUPEES IN ANY PREVIOUS YEAR: OR (C ) CARRYING ON THE BUSINESS SHALL, IF THE PROFITS AND GAINS FROM THE BUSINESS ARE DEEMED TO BE THE PROFITS AN D GAINS OF SUCH PERSON UNDER S. 44D OR S. 44AE OR S. 44AF. AS THE CASE MAY BE. AND HE HAS CLAIMED HIS INCOME TO BE LOWER THAN THE PROFITS OR GAINS SO DEEMED TO BE THE PROFITS AND GAINS OF HIS BUSINESS, AS THE CASE MAY BE. IN ANY PREVIOUS YEAR. GET HIS ACCO UNTS OF SUCH PREVIOUS YEAR AUDITED BY AN ACCOUNTANT BEFORE THE SPECIFIED DATE AND FURNISH BY THAT DATE THE REPORT OF SUCH AUDIT IN TH E PRESCRIBED FORM DULY SIGNED AND VERIFIED BY SUCH ACCOUNTANT AND SET TING FORTH SUCH PARTICULARS AS MAY BE PRESCRIBED : PROVIDED THAT THIS SECTION SHALL NOT APPLY TO THE PERSON, WHO DERIVES INCOME OF THE NATURE REFERRED TO IN S. 44B OR S. 44BB OR S. 44BBA OR S. 44BBB. ON AND FROM THE 1ST APRIL. 1985 OR. AS THE ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 10 CASE MAY BE THE DATE ON WHICH THE RELEVANT SECTION CAME INTO FORCE, WHICHEVER IS LATER : PROVIDED FURTHER THAT IN A CASE WHERE SUCH PERSON IS REQUIRED BY OR UNDER ANY OTHER LAW TO GET HIS ACCOUNTS AUDIT ED, IT SHALL BE SUFFICIENT COMPLIANCE WITH THE PROVISIONS OF THIS S ECTION IF SUCH PERSON GETS THE ACCOUNTS OF SUCH BUSINESS OR PROFES SION AUDITED UNDER SUCH LAW BEFORE THE SPECIFIED DATE AND FURNIS HES BY THAT DATE THE REPORT OF THE AUDIT AS REQUIRED UNDER SUCH OTHER LAW AND A FURTHER REPORT (BY AN ACCOUNTANT) IN THE FORM PRE SCRIBED UNDER THIS SECTION. EXPLANATION : FOR THE PURPOSES OF THIS SECTION. (I ) 'ACCOUNTANT' SHALL HAVE THE SAME MEANING AS IN THE EXPLANATION BELOW SUB S. (2) OF S. 288. (II ) SPECIFIED DATE, IN RELATION TO THE ACCOUNTS OF THE PREVIOUS YEAR RELEVANT TO AN ASSESSMENT YEAR MEANS (A ) WHERE THE ASSE SSEE IS A COMPANY, THE 30TH DAY OF NOVEMBER OF THE ASSESSMENT YEAR, (B ) IN ANY OTHER CASE, THE 31ST DAY OF OCTOBER OF THE ASSESSMENT YEAR. SEC. 27IB. FAILURE TO GET ACCOUNTS AUDITEDIF ANY P ERSON FAILS TO GET HIS ACCOUNTS AUDITED IN RESPECT OF ANY PREVIOUS YEAR OR YEARS RELEVANT TO AN ASSESSMENT YEAR OR FURNISHED A REPOR T OF SUCH AUDIT AS REQUIRED UNDER S. 44AB. THE AO MAY DIRECT THAT S UCH PERSON SHALL PAY. BY WAY OF PENALTY, A SUM EQUAL TO ONE-HALF PER CENT OF THE TOTAL SALES, TURNOVER OR GROSS RECEIPTS, AS THE CAS E MAY BE IN BUSINESS, OR OF THE GROSS RECEIPTS IN PROFESSION, I N SUCH PREVIOUS YEAR OR YEARS OR A SUM OF ONE HUNDRED THOUSAND RUPE ES, WHICHEVER IS LESS. ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 11 SEC. 273B. PENALTY NOT TO BE IMPOSED IN CERTAIN CAS ES NOTWITHSTANDING ANYTHING CONTAINED IN THE PROVISION S OF CL. (B) OF SUB-S. (1) OF S. 271. S. 271A. S. 271B. S. 271BB. S . 271C. S. 271D. S. 271E. S. 271F. CL. (C) OR CL. (D) OF SUB-S. (1) OR SUB-S. (2) OF S. 272A. SUB-S. (1) OF S. 272AA OR SUB-S. (1) OF S. 272BB OR CL. (B) OF SUB-S. (1) OR CL. (B) OR CL. (C) OF SUB-S. (2) OF S. 273. NO PENALTY SHALL BE IMPOSABLE ON THE PERSON OR THE ASSESSEE. AS THE CAS E MAY BE. FOR ANY FAILURE, REFERRED TO IN THE SAID PROVISIONS IF HE PROVES THAT THERE WAS REASONABLE CAUSE FOR THE SAID FAILURE.'' 20. A CONJOINT READING OF S. 44AB AND S. 271B. MANDATE S THAT ANY PERSON CARRYING ON BUSINESS HAVING TOTAL SALES, TUR NOVER OR GROSS RECEIPTS, AS THE CASE MAY BE. EXCEED OR EXCEEDS RS. 40 LACS IN ANY PREVIOUS YEAR, THEN NOT ONLY THE ACCOUNT BOOKS ARE REQUIRED TO BE AUDITED FROM A CHARTERED ACCOUNTANT BUT HAS TO BE F URNISHED IN THE PRESCRIBED FORM DULY SIGNED AND VERIFIED BY SUCH AC COUNTANT ALONG WITH OTHER PARTICULARS. IT MAY BE NOTICED THAT UP T O 30TH JUNE. 1995. THE REQUIREMENT WAS ONLY TO OBTAIN AN AUDIT R EPORT ON OR BEFORE THE DUE DATE BUT BY THE FINANCE ACT. 1995. W .E.F. 1ST JULY. 1995. IT WAS MANDATED THAT THE AUDIT REPORT IS REQU IRED TO BE FURNISHED ON OR BEFORE THE DUE DATE OF FURNISHING O F THE RETURN OF INCOME. A PERUSAL OF S. 271B. NOTICED HEREIN ABOVE, IT ALSO MANDATES THAT IF THE REPORT OF SUCH AUDIT, AS REQUI RED UNDER S. 44AB. HAS NOT BEEN FILED ON OR BEFORE THE DUE DATE, THE AO COULD LEVY PENALTY UNDER S. 271 B OF THE ACT. HOWEVER, S. 273B PRESCRIBES THAT IN CASE THERE IS REASONABLE CAUSE FOR THE SAID FAILURE, PENALTY NEED NOT BE IMPOSED AND S. 27IB FORMS PART OF S. 27 3B. 21. IT WOULD BE APPROPRIATE TO DEAL WITH THE SUBMISSIO N OF THE COUNSEL THAT THE AO AT BHARATPUR ON ACCOUNT OF CHAN GE OF JURISDICTION DID NOT ACCEPT THE RETURN OF INCOME OR THE AUDIT REPORT WHEN PRESENTED IMMEDIATELY ALTER COMPLETION OF THE AUDIT OF ACCOUNTS AS WELL AS RETURN OF INCOME BUT WHAT WAS C ONTENDED, NO TANGIBLE EVIDENCE OR MATERIAL EITHER IN THE SHAPE O F AN AFFIDAVIT OR OTHERWISE OF THE PERSON WHO CLAIMED THAT HE HAD PRE SENTED THE RETURN OF INCOME ALONG WITH AUDIT REPORT BEFORE THE AO AT ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 12 BHARATPUR WAS PLACED OR REFUSAL BY THE OFFICER AT B HARATPUR. IN OUR VIEW, MERE JUSTIFICATION AS ALLEGED WITHOUT ANY SUPPORTING EVIDENCE, IS EXPLANATION AND THE TRIBUNAL HAD RIGHT LY REJECTED THE SAME. 22. THOUGH IT MAY NOT BE RELEVANT BUT FROM THE NARRATI ON OF FACTS, IT CAN BE INFERRED THAT THE AUDIT REPORT, WH ICH HAS BEEN ANNEXED BY COUNSEL FOR THE ASSESSEE. ON AN EARLIER QUERY RAISED BY THIS COURT BY WAY OF AN ADDITIONAL AFFIDAVIT IN THE CASE OF SHIS RAM RAJA RAM & PARTY (DBIT APPEAL NO. 15 OF 2007) A ND ON PERUSAL OF THE AUDIT REPORT, IT CAN BE NOTICED THAT IN THE TRADING ACCOUNT, WHICH IS PART OF THE AUDITED ACCOUNTS, THE TOTAL SALE HAS BEEN DECLARED AT RS. 4.85.35.759 AND EVEN IF WE CON SIDER OTHER RECEIPTS I.E.. REBATE FROM DISTILLARY RS. 3.09.028 AND REBATE FROM WS RS. 30.07.429. THEN THE TOTAL OF ALL THE THREE R ECEIPTS (SALE) IS TO THE EXTENT OF RS. 5.18.52.216 WHEREAS THE AO AT LEAST AT TWO PLACES IN THE PENALTY ORDER STATES THAT THE TURNOVE R AS SHOWN BY THE ASSESSEE IS. TO THE TUNE OF RS. 7.58.62.563. TH US, THOUGH AS STATED HEREIN ABOVE, WE NEED NOT COMMENT UPON BUT A T LEAST CAN BE INFERRED THAT THE TURNOVER AS PER AUDIT REPORT A ND THE TURNOVER AS NOTICED BY THE AO IN THE PENALTY ORDER IS NOT SU PPORTED WITH COGENT MATERIAL ON RECORD. THIS DISCREPANCY, WHEN N OTICED, WAS EXPRESSED TO THE COUNSEL FOR THE ASSESSE ON THE EAR LIER DATE OF HEARING AND SPECIFICALLY OBSERVED IN THE ORDER-SIN OF 13TH FEB.. 2014 BUT EVEN AFTER LAPSE OF ABOUT 8 MONTHS ON THE DATE OF FINAL HEARING, COUNSEL FOR THE ASSESSEE WAS UNABLE TO CLA RIFY THE CORRECT FIGURES OR THE DISCREPANCY NOTICED. HOWEVER, ULTIMA TELY INSOFAR AS IMPOSITION OF PENALTY IS CONCERNED, THE ACT PROVIDE S THAT IT IS MINIMUM TO THE EXTENT OF RS. 1 LAC WHICH ULTIMATELY HAS BEEN IMPOSED BY THE AO AND SUSTAINED BY THE TRIBUNAL. 23. WE MAY ALSO OBSERVE THAT THOUGH THE ASSESSEE HAS T RIED TO CHALLENGE THAT THERE WAS NO INFORMATION ABOUT TRANS FER OF CASES FROM BHARATPUR TO JAIPUR AND S. 127 PROVIDES THAT N OTICE IS REQUIRED TO BE SERVED TO THE ASSESSEE BUT IT CAN SA FELY BE OBSERVED THAT THE ASSESSEE NEITHER CHALLENGED THE T RANSFER OF ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 13 CASES FROM BHARATPUR TO JAIPUR OFFICE NOR RAISED IS SUE OF JURISDICTION AT THE TIME OF TRANSFER OF CASES RATHE R THE ASSESSEE SUBMITTED TO THE JURISDICTION OF THE DY. CIT. CENTR AL CIRCLE-2. JAIPUR AND NOT ONLY FILE THE RETURN OF INCOME BUT T HE AUDIT REPORT ALSO, THOUGH BELATEDLY AND APPEARED REGULARLY BEFOR E THE DY. CIT, CENTRAL CIRCLE-2. JAIPUR IN THE REGULAR ASSESSMENT PROCEEDINGS AND SUBMITTED TO ITS JURISDICTION WITHOUT EVEN UTTE RING A WORD ASSAILING THE SAME BEFORE ANY AUTHORITY. 24. IN THE CASE OF RAJASTHAN CO-OPERATIVE DAIRY FEDERA TION LTD. (SUPRA), THE FACT CAN BE NOTICED THAT THE POWE R TO APPOINT AUDITOR WAS WITH THE REGISTRAR. CO-OPERATIVE SOCIET IES, UNDER S. 68 OF THE CO-OPERATIVE SOCIETIES ACT. 1965 AND UNLE SS THE AUDITOR IS APPOINTED BY THE REGISTRAR. CO-OPERATIVE SOCIETI ES, IT WAS NOT POSSIBLE FOR THE ASSESSEE TO GET ITS ACCOUNTS AUDIT ED AND DESPITE OF REPEATED REQUESTS MADE BY THE ASSESSEE. THE AUDI TOR WAS NOT APPOINTED AND THEREFORE, THIS COURT FELT THAT, THER E WAS A REASONABLE CAUSE. 25. IN THE CASE OF RAJASTHAN STATE ELECTRICITY BOARD ( SUPRA), IT WAS THE CLAIM THAT THE ACCOUNTS OF THE SAID ASSESSE E WERE REQUIRED TO BE GOT AUDITED THROUGH THE ACCOUNTANT G ENERAL AND THE ACCOUNTANT GENERAL WAS THE CONCERNED PERSON AND THE COMPETENT AUTHORITY TO AUDIT THE ACCOUNTS AND DESPI TE THE BOOKS HAVING BEEN HANDEDOVER TO THE OFFICE OF THE ACCOUNT ANT GENERAL, THE AUDIT WAS NOT COMPLETED AND THEREFORE, THAT ASS ESSEE WAS PREVENTED IN GETTING THE ACCOUNTS AUDITED STATUTORI LY BY THE ACCOUNTANT GENERAL IN TIME AND THUS THIS COURT WAS OF THE OPINION THAT ITS CAUSE WAS A REASONABLE CAUSE. 26. THE KERALA HIGH COURT IN THE CASE OF K. RAVINDRANA THAN NAIR V. DY. CIT [2009] 319 ITR 108 HAS HELD THAT IF THERE IS AN ACCEPTABLE EXPLANATION, THEN PENALTY COULD HAVE BEE N AVOIDED WHEREAS IN THE ABSENCE OF ANY EVIDENCE ADDUCED BY T HE APPELLANT AT LEAST BEFORE THE TRIBUNAL, THE MINIMUM PENALTY I MPOSED UNDER S. 271B FOR ADMITTED DELAY FOR FILING AUDIT REPORT WAS UPHELD. ITA NO. 888/JP/2017 SHRI SOHAN NATH VS. ITO 14 27. RESULTANTLY IN VIEW OF WHAT WE HAVE OBSERVED HEREI N IN OUR VIEW, THE TRIBUNAL HAS RIGHTLY SUSTAINED THE PENALT Y UNDER S. 271B OF THE ACT. QUESTIONS ARE ANSWERED IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE. ACCORDINGLY, IN VIEW OF THE ABOVE FACTS AND CIRCUM STANCES OF THE CASE AS WELL AS THE BINDING PRECEDENT, WE DO NOT FIND AN Y ERROR OR ILLEGALITY IN THE IMPUGNED ORDER OF THE AUTHORITIES BELOW FOR LEV Y OF PENALTY U/S 271B OF THE ACT. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 06/03/2019 SD/- SD/- JESK LH0 KEKZ FOT; IKY JKO (RAMESH. C. SHARMA) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 06/03/2019. * SANTOSH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI SOHAN NATH, AJMER. 2. IZR;FKHZ@ THE RESPONDENT- ITO, WARD-1(3), AJMER. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 888/JP/2017} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRARS