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2020 (2) TMI 982 - ITAT CUTTACKPenalty u/s.271A - non-maintenance of books of account u/s. 44AA - assessee could not file any reasonable cause for non-maintenance of books of accounts - HELD THAT:- Assessee has maintained various registers and money receipt books containing details of fee received from patients against the medical services obtained by the patients. Therefore, it cannot be said that the assessee is not engaged in the medical profession. It is not necessary that the proprietor of the institution must have qualified degree. The predominant purpose of service needs to be tested for falling u/s.44AA which is existing in the present case. The AO has calculated the income of the assessee in detailed manner after verifying from the seized record. Assessee as taken in ground No.1 is not acceptable because the AO has not accepted the returned income of the assessee while calculating taxable income of the assessee. Therefore, no need to issue defect notice by the AO u/s.139(9)(f) before initiating penalty u/s.271A. With regard to ground No.2 the contention of the assessee is that as the turnover of the assessee during the year did not exceed the threshold limit, therefore, Section 44AD of the Act cannot be invoked. This contention of the assessee is also not acceptable because the assessee has different type of registers which were discovered during the course of search and seizure proceedings. According to the registers the assessee is giving services of medical treatment and charging fee for the services/treatment given to the patients. Therefore, it cannot be denied that the assessee was not engaged in the medical profession which covers u/s.44AA. During the course of assessment proceedings, the assessee could not produce any accounts which were required to be maintained by the assessee for earning the impugned income from the operation of nursing home. AO was justified in imposing the penalty u/s.271A for non-maintenance of the books of accounts. No reason to interfere in the order of the CIT(A) in upholding the penalty levied by the AO u/s.271A - Decided against assessee.
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