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2016 (5) TMI 1562 - AT - Income TaxPenalty u/s 271(1)(b) - assessee has not made proper compliance with the statutory notices - non maintaining books of accounts - assessee submitted that the Assessing Officer wanted the assessee to produce the books of accounts for computing the total income but for maintenance of books of accounts by an individual or any person not having the income from profession as specified in sub-section (1) of section 44AA or carrying on business or profession having income - HELD THAT:- No penalty can be imposed on the person or the assessee, as the case may be, for failure referred to in the above section if he proves that there was reasonable cause for such failure. Now in the instant case, the assessee has complied with all the notices and he has raised a legal objection that the assessee is not required to maintain books of accounts and if at all he is required to maintain the books of accounts that too for six years. Moreover, the assessee has filed detailed affidavit and also demanded the reasons recorded for reopening the assessment order. Therefore, this contention of the assessee can be said to be a reasonable cause for noncompliance with the notices issued by the Assessing Officer. As assessee has filed the reply and raised the legal objection. The legal objection is tenable or not is not a question before me but in my opinion, the assessee has complied with the notices issued under subsection (1) of section 142 of the Act and moreover the assessee has also raised the legal objection that the assessee is not required to maintain the books of accounts as the assessee is not carrying on any profession or business. As assessee has a reasonable cause for not complying with the notices. Moreover, the Assessing Officer has also stated that proper compliance is not made but the assessee has complied with the notices. Therefore, as per section 273 of the Act, the assessee has a reasonable cause for non-compliance with the notices to the satisfaction of the Assessing Officer - Decided in favour of assessee.
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