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2018 (1) TMI 729 - AT - Income TaxPenalty u/s. 271B / 271(1)(b) & 271F - delay in auditing the books of account required u/s. 44AB - Held that:- Assessee started its business from the F.Y 2007-08 relevant to A.Y 2008-09 and the audit was completed on 02-09-2008 i.e within time. A.Y under consideration the assessee required to file the tax audit report by 30-09-2009. However, due to such disputes and delay, the same was filed by the assessee on 15-03- 2011 by a new auditor, M/s. B.S. Murthy & Associates, who was appointed on 20-12-2010. Therefore, it clearly shows that due to disputes between the assessee with its earlier auditor and resignation thereof, the same (audited accounts) was filed before the AO belatedly. On perusal of the said statement filed by the assessee before us, we find that there was delay in getting the accounts audited only in the A.Ys 2009-10 & 10-11 and there was no delay in immediate earlier previous year and subsequent years i.e. 2010-11 to 2016-17. Thus, the said delay in filing the tax audit was not intentional. There was reasonable cause in not getting the accounts audited and filing the same before the AO in time. Therefore, in such peculiar circumstances, the penalty is liable to be held as invalid and the same is cancelled. Thus, the penalty imposed by the AO and confirmed by the CIT-A is cancelled. The ground raised by the assessee in this regard is allowed. Penalty u/s. 271F - not filing the return of income in time required u/s. 139(1) as well as at the end of relevant A.Y - whether the delay caused in filing the return of income is reasonable or not? - Held that:- We note that the delay in filing the return of income was explained by the assessee before the authorities, which have not been considered by them in their right perspective in terms of section 273B of the Act. The said section explains no penalty shall be imposable on the person or the assessee proves that there was reasonable cause for any failure in terms of section 271F of the Act. We note that the said burden in terms of section 273B was discharged by the assessee by adducing reasonable cause for the said failure. Therefore, in our opinion by reading the section 271F and 273B of the Act conjointly no penalty is invited in the present case. Thereby, in such peculiar circumstances, we cancel the penalty - Decided in favour of assessee Penalty u/s. 271(1)(b) - non submissions of specific documents and evidences sought u/s. 142(1) - Held that:- We find that the assessment order dt. 29-12-2011 passed u/s. 147/143(3), wherein we noticed that there was no allegation of non compliance was made by the AO. It is observed that the assessee through his AR complied with the notice and books and other relevant documents were filed, which were examined by the AO. We find that the ld.AR has rightly pointed out that there was no allegation by the AO in not complying with the notice. - Decided in favour of assessee
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