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2017 (2) TMI 505 - AT - Income TaxPenalty under section 271B - not getting accounts audited under section 44AB - Held that:- The penalty under section 271B is imposable under the Act if the assessee fails to prove that there was a reasonable cause for failure on the part of the assessee for not complying the mandatory provision of section 44AB in terms of 273B of the Act. In our view, the assessee was required to get its accounts audited at the time of filing of the return of income at the first instance i.e., on 30.07.2007 and in any case the assessee was having an opportunity to file the audited reports after receipt of the notice under section 153A of the Act when the assessee was called upon to file the return of income. However, despite receipt of notice issued under section 153A, the assessee had failed to file the audited accounts report. The claim of the assessee that the assessee was following the project completion method, therefore the assessee had bonafide belief for not getting its accounts audited, is not sustainable as the application of section 44AB is independent and is not depended upon the method of accounts adopted by the assessee under section 145 of the Act whether it is project completion method or percentage completion method. The requirement under section 44AB is based on the total sales, turnover or gross receipt as the case may be of the assessee and . If it exceeds the threshold limit as provided under the Act, then the assessee is required to compulsorily get its accounts audited before the specific date. Since, the assessee has failed to do so, therefore, we have no other option but to confirm the order passed by the CIT in imposing the penalty. - Decided against assessee.
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