9911796707
TMI Blog2007 (5) TMI 345X X X X Extracts X X X X X X X X Extracts X X X X ..... . Shri Rattan Singh-Departmental representative appeared on behalf of the Revenue whereas Shri Sanjay Kumar Tiwari, chartered accountant, appeared on behalf of the assessee. 3. The assessee filed returns showing receipts of Rs. 2,72,77,287 for the assessment year 2003-04 and Rs. 3,82,86,163 for the assessment year 2004-05. In both assessment years, audit reports filed along with the returns were not accompanied by form No. 3CD (statement of particulars required to be furnished under section 44AB). The Assessing Officer issued show-cause notices to the assessee requiring it to explain as to why penalty under section 271B should not be imposed for failing to get the audit done and furnish the audit report before the specified date. The asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... He also rejected the contention of the assessee that it did not carry out any business or profession. So far as the plea of bona fides is concerned, the Assessing Officer did not accept the same and held the assessee liable to penalty under section 271B on account of its failure to comply with the provisions of section 44AB. He, therefore, imposed penalty of Rs. 1 lakh in each assessment year. 5. The assessee challenged the penalty. During the course of appellate proceedings various objects of the assessee-society were explained. It was submitted that the main object of the assessee was to promote and develop the game of hockey in the country. Besides, the following submission was also made : "Further it is stated for your kind informati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or a sum of one hundred thousand rupees, whichever is less'. The learned Assessing Officer has examined the books of account and aware of the fact that the appellant activity is not for the purpose of accruing or generating any kind of profit or gains from business, merely showing under wrong column of return of income could not attract any penalty under section 271B. The selection of wrong return of income and jurisdiction of the authority will not change the facts, substance inherit in the law. It is well settled that section 271B is to apply only if activity of the assessee, nature of income to be assessed under Chapter IV, Head D, which categorically prescribed for the nature of income falling only if under the profit and gains from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt year 2004-05 as mentioned by the Assessing Officer. Therefore, it is not a case where the audit has not been done at all by the appellant-Federation. Keeping in view the above facts and circumstances, the penalty imposed for both years, i.e., 2003-04 and 2004-05 amounting to Rs. 1 lakh each are deleted and the appeal of the appellant is allowed." 8. We have carefully considered the entire material on record and the rival submissions. The learned Departmental representative could not controvert the stand of the assessee that the main object of the assessee Federation was to promote and develop the game of hockey in the country ; that the assessee was not involved in any kind of business activity to earn profit or gains ; and the major s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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