Case Law Details
United Education Society Vs JCIT (ITAT Delhi)
Undisputedly, the assessee society is registered under section 12A of the Act as a charitable trust engaged in charitable activities for imparting education through its colleges. It is also not in dispute that the assessee society has been claiming exemption under section 11 of the Act on the ground that no business is being carried out by it.
Bare perusal of the provisions contained under section 44AB of the Act goes to prove that the same are applicable to the person carrying on business or profession and is required to get its account mandatorily audited by an accountant. But, in the instant case, when assessee is undisputedly a charitable society and is not carrying out any business and has been claiming exemption under section 11A of the Act, the penalty under section 271B of the Act cannot be levied. Furthermore, when there is no computation of profits and gains of the business or profession as part of the total income, the assessee society is not amenable to section 44AB of the Act.
we are of the considered view that when the assessee under bona fide belief claimed the exemption under section 11 of the Act and had not got his accounts audited from the accountant as per provisions contained under section 44AB, penalty under section 271B cannot be levied, hence penalty imposed under section 271B is hereby ordered to be deleted by reversing the order passed by the assessing officer as well as learned Commissioner (Appeals).
FULL TEXT OF THE ITAT ORDER IS AS FOLLOWS:-
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