Case Law Details
Manphool Singh Vs ITO (ITAT Jaipur)
ITAT Jaipur held that assessee failed to get its books of accounts audited based on a reasonable cause. Accordingly, penalty under section 271B of the Income Tax Act for failure to get books of account audited not leviable as assessee reasonable cause shown.
Facts- During the assessment proceedings, it was noticed that the total turnover/gross receipts of the assessee was at Rs.1,29,00,787/-. Therefore, the assessee was required to get his accounts audited by an accountant but as per the records the accounts of the assessee were not got audited. Based on these observation order of levying penalty u/s. 271B for an amount of Rs. 65,000/- was passed by the NeFAC. CIT(A) confirmed the levy of penalty. Being aggrieved, the present appeal is filed.
Conclusion- The reasons advanced by the assessee this he has offered the income under the head capital and under that head though the income / receipt 1 cr there is no requirement to get the books of accounts audited and therefore, this being the reasonable cause for the assessee. The provision of section 271B gives power to the taxing authority not to impose the penalty if the assessee proves that there was a reasonable cause for such failure.
Held that the assessee was prevented by sufficient cause and therefore, we are of the considered view that the penalty of levied by the lower authorities confirmed by the ld. CIT(A) u/s 271B of the Act does not have any legs to stand, therefore, the same is deleted.
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