Anant Cutting Edge Private Limited Vs ITO (ITAT Pune Bench)
Return Was Late, but Income Was Not Hidden: Taxes Paid & Audit Report Uploaded Before Reopening Save Assessee From Penalties u/s 270A & 271B – ITAT Pune
Summary: The assessee-company was an authorised distributor of cemented carbide cutting tools, abrasive products and grinding wheels. It did not file its return of income for AY 2020-21 within the prescribed time.
Based upon information regarding substantial financial transactions, the AO reopened the assessment by issuing notice u/s 148 on 29.02.2024. In response, the assessee filed its return on 11.05.2024 declaring total income of ₹27,17,950.
The AO completed the reassessment by accepting the returned income without making any addition. However, since the return had been filed only after issuance of notice u/s 148, the AO initiated proceedings for under-reporting and levied penalty of ₹27,17,950 u/s 270A.
The AO also levied the maximum penalty of ₹1,50,000 u/s 271B for failure to obtain and furnish the tax audit report within the prescribed time. The CIT(A), NFAC, confirmed both penalties.
Before the Tribunal, the assessee explained that its financial statements had been audited on 20.12.2021 and the tax audit report had been uploaded on the income-tax portal on 11.01.2022, much before the reassessment notice dated 29.02.2024.
