Case Law Details
Reliable Enterprises Vs ITO (ITAT Pune)
ITAT held that It is seen that there is an infringement of provisions of section 44AB inasmuch as the assessee failed to get the accounts audited and furnish the necessary report before the stipulated period. The assessee pleaded a reasonable cause before the AO that the audit could not be carried out because of ill-health of his wife, which further worsened the family problems. Section 271B is subject to provisions of section 273B which provides that in case of a reasonable cause, penalty under the concerned section need not be imposed. In the given set of facts and circumstances, we are satisfied that there was a reasonable cause which prevented the assessee from complying with the necessary provisions in getting the accounts audited and furnishing the report to the AO before the due date. We, therefore, order to delete the penalty.
FULL TEXT OF THE ORDER OF ITAT PUNE
This appeal by the assessee is directed against the order passed by ld. CIT(A)-2, Nashik on 02.01.2019 confirming the penalty of Rs.1,25,486 imposed by the Assessing Officer (AO) u/s 271B of the Income-tax Act, 1961 (hereinafter referred to as „the Act‟).
2. Briefly stated, the facts of the case are that the assessee is a firm engaged in the business of Labour work contracts. Return was filed declaring total income at Rs.1,47,710. The AO observed that the gross receipts of the assessee were to the tune of Rs.2,50,97,142 and the assessee had failed to get the accounts audited u/s 44 AB and furnish the same. He, therefore, imposed penalty u/s 271B of the Act, which came to be affirmed in the first appeal. Aggrieved thereby, the assessee has approached the Tribunal.
3. We have heard the ld. DR and perused the record. There is no appearance from the side of the assessee despite notice. As such, we are proceeding to dispose of the appeal ex parte qua the assessee. It is seen that there is an infringement of provisions of section 44AB inasmuch as the assessee failed to get the accounts audited and furnish the necessary report before the stipulated period. The assessee pleaded a reasonable cause before the AO that the audit could not be carried out because of ill-health of his wife, which further worsened the family problems. Section 271B is subject to provisions of section 273B which provides that in case of a reasonable cause, penalty under the concerned section need not be imposed. In the given set of facts and circumstances, we are satisfied that there was a reasonable cause which prevented the assessee from complying with the necessary provisions in getting the accounts audited and furnishing the report to the AO before the due date. We, therefore, order to delete the penalty.
4. In the result, the appeal is allowed.
Order pronounced in the Open Court on 29th November, 2022.
