TMI Blog2011 (2) TMI 1399X X X X Extracts X X X X X X X X Extracts X X X X ..... re the transaction was principle to principle basis and not as agent. Therefore in our view in case of the assessee gross amounts received in connection with entry business have to be considered for the purposes of ceiling of ₹ 40 lacs u/s 44AB. The circular No.452 of the CBDT relied upon by the assessee is also distinguishable as the same related to kachha arithia. The decision of the tribunal in case of R.Wadiwala Co. Vs ACIT [ 2000 (11) TMI 277 - ITAT AHMEDABAD-B] is obviously distinguishable as the same related to share transactions and not accommodation bills. It may also be pointed out that the assessee has not raised any ground that he was not liable for audit u/s 44AB. Therefore, the case of the assessee was covered u/s 44AB and the accounts were required to be audited and audit reports were required to furnished within the prescribed date which had not been done. Penalties were therefore leviable and the same had been rightly levied by the authorities. The order of CIT(A) is accordingly upheld. all the appeals of the assessee stand dismissed. - Shri D.K. Agarwal (JM) and Shri Rajendra Singh(AM) For the Appellant : Shri Darmesh D.Shah For the Responde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment proceedings however the assessee had filed copy of profit and loss account for all the years and the sundry receipts declared in these returns were ₹ 2,01,84,742/-, ₹ 2,89,74,988/- and ₹ 1,68,51,132/- respectively for the three years under reference. The AO observed that under the provisions of section 44AB the assessee was required to get the accounts audited by the accountant and furnish the copy of the same to the AO within the specified date which was the due date of filing the return of income under section 139(1) i.e 31st day of October of the relevant assessment year. Since the assessee had failed to get its accounts audited and furnish a copy of the same before the specified date the AO initiated penalty proceedings under section 271B of the Income-tax Act by issuing the show-cause notice dated 25.5.2009. In response to the show cause notice the Authorized Representative of the assessee filed a reply dated 9.6.2009 stating that all the tax audit reports and other relevant documents were filed along with return of income and therefore no penalty should be levied. The Authorized Representative who appeared before the AO was confronted with th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 44AB were very clear which referred to total sale, turnover or gross receipts for the purpose of ceiling of ₹ 40 lacs. Thus the essence of section 44AB was gross receipts and not the element of income. He distinguished the decision of tribunal in case of R.Wadiwala Co. Vs ACIT (supra) on the ground that the same related to share transactions which were completely different from issuing accommodation bills. Moreover in that case genuineness of share transactions was not in doubt whereas in the present case the transaction was not genuine. The tribunal in that case had also held that the assessee was under bonafide belief that the provisions of section 44AB was not applicable which was not so in the present case. Referring to the CBDT circular No. 452 CIT(A) observed that it did not lay down any general principle regarding the ceiling of ₹ 40 lacs and that the same was restricted to only Kaccha Arathia. Further the circular also stated that each transaction was required to be examined with reference to the terms and conditions of that case and no hard and fast rules would be laid down as to whether a person was acting only an agent or principal. There was theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee had also been confronted with the original returns filed which showed that no audited accounts had been filed. The assessee had also opportunity to file any additional evidence or any affidavit before the CIT(A) which had also not been done. We have also no difficulty in deciding the issue on the basis of material available on record because filing of audited accounts could be easily verified from the records which have already been gone into by the authorities below and the assessee has not produced any acknowledgment receipt etc even at this stage. Even if these affidavits are admitted in our view these are not going to serve any purpose other than delaying the proceedings as these only contain the points made before the lower authorities. The additional evidences are therefore not admitted. 7. We have therefore to decide the appeals on the basis of material available on record. Under the provisions of section 44AB in case the total sales/ turnover/ gross receipts of the business exceeds ₹ 40 lacs the assessees are required to get the accounts audited compulsorily and furnish the same to the AO within the due date of filing the return of income under section 139(1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh the concerns in his control and in exchange thereof had issued cheques. Therefore the transaction was principle to principle basis and not as agent. Therefore in our view in case of the assessee gross amounts received in connection with entry business have to be considered for the purposes of ceiling of ₹ 40 lacs under section 44AB. The circular No.452 of the CBDT relied upon by the assessee is also distinguishable as the same related to kachha arithia. The decision of the tribunal in case of R.Wadiwala Co. Vs ACIT (supra) is obviously distinguishable as the same related to share transactions and not accommodation bills. It may also be pointed out that the assessee has not raised any ground that he was not liable for audit under section 44AB. The arguments advanced are therefore rejected. 9. In view of the foregoing discussion and for the reasons given earlier we agree with the findings of the authorities below that the case of the assessee was covered under section 44AB and the accounts were required to be audited and audit reports were required to furnished within the prescribed date which had not been done. Penalties were therefore leviable and the same had been ri ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
