Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (8) TMI 772 - AT - Income TaxPenalty u/s 271B - violation of provisions of section 44AB - whether there is a reasonable cause for the delay on the part of the appellant to submit the audit report before the due date of filing the return of income? - assessee being a society set up under the Societies Act, 1958 - Held that:- The assessee’s belief that being a society running educational institutes is not carrying on business is a reasonable belief which is fortified by subsequent grant of registration under section 12A by the CIT. Even though grant of registration u/s 12A is not a basis that the income of the assessee would be fully exempt or the assessee wouldn’t be required to file its return of income, it is atleast a reasonable basis to hold that the provisions of section 44AB are not attracted. Basis such belief, where the provisions of section 44AB have not been complied with, it is a matter where the assessee has shown reasonable cause and the AO should have exercised his discretion in favour of the assessee in not levying the impunged penalty. Further, for the reason that there was a delay in submission of audit report where section 44AB is attracted, the AO has not given any adverse finding that it affected the proper computation of income in terms of provisions of the Act or any claim to any deduction by the assessee under any provisions of the Act. In such event, the breach remains a technical breach of the procedural requirement as the intent behind the introduction of section 44AB have been fulfilled which is basically to help support the AO to compute true income in the hands of the assessee. Thus we are of the view that penalty u/s 271B cannot be levied in the instant case hence this same is deleted - Decided in favour of assessee
|