2023 (3) TMI 481 - AT - Income Tax

Penalty u/s 271B - Non filing of audit report under section 44AB on time - HELD THAT:- As there is no dispute that audit report was filed along with return of income under section 139(1) of the Act on 29.02.2016 and date of filing return under section 139(1) was 30.09.2015, the audit report was filed along with returned income. It is a matter of fact that Assessing Officer passed assessment order u/s 143(3) on 03.11.2017 in accepting the returned income of assessee.

Hon'ble Madras High Court in the case of CIT vs. Apex Laboratories (P.) Ltd. . [2006 (1) TMI 90 - MADRAS HIGH COURT] held when accounts were audited and the assessee got audit report but the same was filed along with returned income which was filed belatedly, penalty could not be imposed under section 271B of the Act. Therefore, direct the Assessing Officer to delete the penalty under section 271B.

Also in CIT VS Jagat Rice Mills [2005 (3) TMI 824 - ALLAHABAD HIGH COURT] by following its earlier decision in CIT Vs Jai Durga Construction [1999 (11) TMI 27 - ALLAHABAD HIGH COURT] also held that penalty under section 271B was not leviable for delay in filing audit report as the assessee had got its accounts audited and obtained the audit report within the time allowed under section 139(1). Thus find that the ratios of the above decisions are squarely applicable on the facts of the present case. Appeal raised by assessee is allowed.