TMI Blog2014 (5) TMI 693X X X X Extracts X X X X X X X X Extracts X X X X ..... e applicability of section 44AB in the cases of commission agents, arhatias etc has clarified that in the case of agent whose position is similar to that of Kuccha Arhatia, the turnover is only the commission and does not include the sales on behalf of the Principals. Penalty u/s 271B of the Act – Held that:- The AO is vested with discretion to levy the penalty - when there is technical or venial breach of the provisions of law, the ends of justice require that discretion should not be exercised in favour of punishing a minor default – Relying Hindustan Steel Ltd. Vs State of Orissa [1969 (8) TMI 31 - SUPREME Court] - no penalty u/s 271B of the Act was imposable - Decided in favour of Assessee. - I.T.A. No. 3168 /AHD/2011 - - - Dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2% of the turnover (amounting to Rs 40,324/). Aggrieved by the order of AO, Assessee carried the matter before CIT(A). CIT(A) vide order dated 12.9.2011 confirmed the order of AO by holding as under:- 2.3 But entire above submission of the A.R is not acceptable in view of the facts involved in the case of appellant. In the case of appellant form No. 16A dated 18.4.2006 has been issued by Assistant Manager, Finance of Hindustan Coca Cola. On perusal of such form 16A it is seen that amounts of TDS of Rs 1,80,671/- have been made by this company on the payments made to the appellant on different dates. The total payments of Rs. 80,64,855/- have been credited to the bank account of the appellant. The TDS have been made by the above company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e receipt of Rs. 80,64,255/- as contractee assessee and has met out various expenses at its own. Thus instead of acting merely as commission agent, the appellant is managing affairs of business of transportation at its own and therefore, it can be said that he is liable to get his books of accounts audited in terms of provisions of Section 44AB of the Act. The turnover/ receipts in the case of appellant is exceeding the monetary limit as prescribed under the provisions of section 44AB of the Act. In view of these facts, I am of the view, that A.O has correctly levied penalty of Rs. 40,324/-u/s.271B of the Act, in the, case of the appellant and, therefore, the same is confirmed. 5. Aggrieved by the order of CIT(A), Assessee is now in appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Arahatia and therefore the amount received by him as an agent was not his turnover and therefore he was not liable for tax audit u/s 44AB of the Act. The aforesaid submissions of the assessee, prima facie, appears of be bonafide and the Revenue has not brought any material on record to support that the belief of the Assessee was not bonafide. CBDT vide Circular No 452 dated 17.3.1986 regarding the applicability of s 44AB in the cases of commission agents, arhatias etc has clarified that in the case of agent whose position is similar to that of Kuccha Arhatia, the turnover is only the commission and does not include the sales on behalf of the Principals. With respect to levy of penalty u/s 271B, the AO is vested with discretion to levy the p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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