TMI Blog2022 (1) TMI 139X X X X Extracts X X X X X X X X Extracts X X X X ..... ient to prove that transactions of share trading carried out by the assessee during the year are in the nature of business. This plea of the assessee that he was ignorant about the provision of getting books of account audited, find no merit as ignorance of law is no excuse and carrying out the transactions of the magnitude in itself leaves no room for the assessee to make an excuse for not getting books of account audited u/s 44AB - Decided against assessee. - ITA No.339/Ind/2020 - - - Dated:- 6-12-2021 - Shri Rajpal Yadav Hon'ble Vice President And Shri Manish Borad, Accountant Member For the Appellant : Shri S.S. Deshpande, AR For the Respondent : Shri Amit Soni, Sr.DR ORDER PER MANISH BORAD: The above captioned appeal at the instance of Assessee is directed against the order of Ld. Commissioner of Income Tax(Appeals)-2, (in short CIT(A) ), Bhopal dated 01.05.2019 which are arising out of the order u/s 271B of the Income Tax Act 1961(In short the Act ) dated 26.05.2017 framed by ITO-5(2) Bhopal. The Assessee has raised following grounds of appeal in ITANo. 339/Ind/2020: 1. That on the facts and in the circumstances of the case the ld. CIT( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4AB of the Act. We note that the assessee is a retired employee and files regular return of income. For the year under appeal though the assessee has filed income tax return but he has not disclosed the transaction of purchase/sale of equity shares neither under the head of business and profession nor capital gain. Assessee is maintaining share trading account with Nirmal Bang Securities Pvt. Ltd. Total sales made on delivery based transaction amounting to ₹ 3,13,81410/-. Assessee has not disputed this figure of sale turnover of share trading of delivery based transaction but only claimed before ld. AO that these transaction were in the nature of purchase and sale of shares held for less than 12 months and there was short term capital loss which was not disclosed in the income tax return. 7. We, however find that Ld. AO has given categorically finding that the assessee had made frequent transaction in both delivery as well as non-delivery based segment of shares and volume and quantity of buying and selling of shares was also found to be substantially high which are sufficient to prove that transactions of share trading carried out by the assessee during the year are in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is trading or business activities. It does not differentiate between commodities sold under the head speculative business/ normal business. Transfer of immovable or movable property by way of investment is not included by the provisions of the section 44AB of the Act. Provisions of the Act are clear that all revenue receipts are covered by the words turnover, wherever capital receipts are not to be considered a part of the turnover for the purposes of the said section. In other words, receipts which are not relatable to business and may fall under the expression 'income to be subjected to tax as income from sources' do not form part of total turnover. Considering the principles gotJerning the imposition of penalty u/ s. 271 B and the facts of the case we are of the opinion that AO was justified in levying penalty for not her books of accounts audited. In his submission the appellant has relied upon the following case laws: i) Surajmal Parshuram Todi v CI1' (1997) (Gau) 209 ii. CIT v Bisauli Tractors (200812991TR 219 (AlL) iii) CIT ANR. V S. K. Gupta Co. (2010) 322 ITR 86 (All) The gist of all the referred cases is that the requirement of g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uired to get audited as per the provisions of Section 44AB of the Act. During the assessment proceedings, the AO obtained the statement of transactions from the broker u/s 133(6) and on the basis of this statement, the AO noticed the quantum of turnover and profit or Therefore, it can be said that the AO was able to complete the assessment proceedings on the basis of available books of account of the appellant in the form of statement of transactions. No other records / documents were needed by the AO to ascertain the total income of the appellant. The AO nowhere in the assessment order or penalty order has mentioned that the appellant did not maintain books of account u/s 44AA. Therefore, it is clear that the AO was satisfied with the adequacy of the books of account in the form of statement of transactions obtained from the broker. Therefore, in my opinion, the facts and circumstances of the case laws quoted by the appellant and those of the present case are different as in case laws quoted by the appellant, the assessee was liable to maintain books of account in the form of Trading e.[c, P L e.f c, Balance Sheet, Bills and Vouchers, cash book etc. Moreover, in my views, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the section 44AB of [he Act so as to get himself rid of the obligation to get the accounts audited as contemplated under section 44AB of the Act. We further held that giving such a meaning to the expression accounts as given by the assessee would completely defeat the very purpose and object of the section 44AB of the Act, which has been inserted in the statute to ensure that the books of account and other records are properly initiate that they faithfully reflect the income of the taxpayer and claims for deduction .....................are correctly made by him. Such audit would. al so help in checking ....... fraudulent practices. It can also facilitate the administration of tax ........ laws by a proper presentation of the accounts before the tax authorities and considerably saving the time of Assessing Officers carrying out routine verifications, like checking correctness of totals and verifying whether purchases and sales are properly vouched or not. The time of the Assessing Officers thus saved could be utilized for attending to more important investigational aspects of case . I am therefore convinced that there was no requirement of further production of any oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ooks of account audited as per the provisions of Section 44AB of the Act. The plea that the appellant had not maintained books of account holds no merit and factually incorrect. I am of the opinion that in the present case the appellant has been unable to prove that there was reasonable cause for failure to get the books of account audited as required uls 44AB. Thus, the appellant was required to between its records i.e. books of account audited as per the provision o section 44AB of the Act. The plea that the appellant had not maintained books of account holds no merit and factually incorrect. 6.2 I am of the opinion that in the present case the appellant has been unable to prove that there was reasonable cause the failure to get the books of account audited as required u/s 44AB. In his submission, the appellant has clearly stated that he deals in share (including intraday) and all the records relating to such transactions are mentioned online by his broker. Therefore, the record of the transactions entered into by the appellant was always accessible to him. In view of the broad discussion held herein before and relying upon the cited case laws. I confirm the penalty u/s 271B ..... X X X X Extracts X X X X X X X X Extracts X X X X
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