Case Law Details
Kendrapara Credit Co-operative Society Ltd. Vs ITO (ITAT Cuttack)
A perusal of the facts as recorded by the AO shows that the delay in submitting the audit report was on account of delay in obtaining audit report from the statutory auditors. It is fairly admitted that the statutory auditors is appointed by the Registrar of Co-operative Societies and not by the assessee. This being so, we are of the view that the assessee has sufficient and reasonable cause for delay in obtaining the audit report. It is also an admitted fact that the audit report was available before the AO, when the assessment was done. This being so, we are of the view that it is a fit case for deletion of penalty u/s.271B of the Act. Consequently, the penalty levied by the AO U/S.271B of the Act and confirmed by the ld CIT(A) stands deleted.
FULL TEXT OF THE ORDER OF ITAT CUTTACK
This is an appeal filed by the assessee against the order of the CIT(A), National Faceless Appeal Centre (NFAC), Delhi dated 19.3.2021 in Appeal No. CIT(A), Cuttack /10165/2019 -20 for the assessment year 2016-17.
2. The appeal is barred by limitation by 87 days. The assessee has filed condonation petition, stating therein that due to shutdown and lockdown on account of COVID -19, it was not possible to have consultation and preparation of appeal with the legal consultant resulting in the delay of 86 days in filing of appeal. It is prayed that the delay in filing the appeal be condoned. Ld CIT DR did not object to the condonation of delay.
3. After going through the condonation petition, we find that the assessee had reasonable cause for not filing the appeal within the stipulated time. We, therefore, condone the delay 87 days in filing the appeal before the Tribunal and admit the appeal for hearing.
4. The sole ground taken in this appeal by the assessee is that the ld CIT(A), NFAC is not justified in confirming the penalty of Rs.1,50,000/-levied u/s.171B of the Act by the Assessing Officer.
5. Shri C.Parida, ld AR appeared for the assessee and Shri M.K.Gautam, ld CIT DR appeared for the revenue.
6. It was submitted by ld AR of the assessee that the audit report of the assessee was not submitted in time because same was received belatedly from the statutory auditors, who are to do the audit of the assessee as per the Co-operative Society Act. It was the submission that the delay in getting the report of audit done by the statutory auditors was beyond the control of the assessee. It was the prayer that the penalty as levied by the AO and confirmed by the ld CIT(A) may be deleted.
7. In reply, ld CIT DR vehemently supported the order of the AO and ld CIT(A). It was the submission that the assessee has been absolutely non-co-operative and there is no compliance before the AO nor the ld CIT(A) in respect of the reasons for delayed audit accounts. It was the submission that if at all, the assessee has the reasonable cause, he could have filed before the AO and ld CIT(A). It was the submission that the penalty as levied by the AO and confirmed by the ld CIT(A) was liable to be upheld.
8. We have considered the rival submissions. A perusal of the facts as recorded by the AO shows that the delay in submitting the audit report was on account of delay in obtaining audit report from the statutory auditors. It is fairly admitted that the statutory auditors is appointed by the Registrar of Co-operative Societies and not by the assessee. This being so, we are of the view that the assessee has sufficient and reasonable cause for delay in obtaining the audit report. It is also an admitted fact that the audit report was available before the AO, when the assessment was done. This being so, we are of the view that it is a fit case for deletion of penalty u/s.271B of the Act. Consequently, the penalty levied by the AO U/S.271B of the Act and confirmed by the ld CIT(A) stands deleted.
9. In the result, appeal of the assessee is allowed
Order dictated and pronounced in the open court on 7 /6/2022.
