Anita Basak Vs ACIT (ITAT Kolkata)
Penalty u/s 271A Not Leviable Where Books Are Maintained & Audited – ITAT Kolkata Deletes ₹25,000 Penalty
The Kolkata Bench of the ITAT, in Anita Basak vs. ACIT, Central Circle-1(1), Kolkata (ITA No.2174/KOL/2025, AY 2018-19, order dated 19-12-2025), deleted the penalty levied u/s 271A for alleged failure to maintain books of account.
In this case, although during a survey u/s 133A the books were found to be not updated, the Tribunal noted that the assessee had in fact maintained books of account, which were also audited u/s 44AB, and the audit report, balance sheet & P&L account were available on record. Merely because there were shortcomings—such as non-maintenance of stock register or incomplete details—the same could not lead to a conclusion that no books were maintained.
The Tribunal held that rejection of books u/s 145(3) or estimation of income does not automatically justify penalty u/s 271A. Relying on the Third Member decision in ACIT vs. Aggarwal Construction Co. (106 ITD 129), it was reiterated that defects, unreliability or incompleteness of accounts may invite other consequences under the Act, but cannot be equated with complete failure to maintain books.
Accordingly, the ITAT set aside the order of the CIT(A) and directed deletion of the penalty, holding that the levy of penalty u/s 271A was unsustainable in law
FULL TEXT OF THE ORDER OF ITAT KOLKATA
