9911796707
TMI Blog2020 (6) TMI 292X X X X Extracts X X X X X X X X Extracts X X X X ..... rea is an essential ingredient of an offence has not been considered by the authorities below, therefore penalty levied is not sustainable in law. 3) That since the assessee has maintained such books of account which was duly audited and submitted before the AO as may enable the AO to compute his total income in accordance with the provision of law, therefore no offence was committed by the assessee so that he could be visited with penalty. 4) That the income assessed by the AO has been substantially reduced in appeal and resulted in refund, therefore penalty is not excisable. 5) That other ground if any will be urged at the time of hearing of appeal. 2. Brief facts of the case are that the assessee is an individual deriving income f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... how cause notice for the rejection of books of accounts and net profit disclosed by the assessee by invoking the provisions of Section 145(3) of the Act, 1961 and computed the profit @4% of the total turnover transferred by the assessee in audit report and imposed penalty u/s.271A of the Act for not complying the provisions of Section 44AA of the Income Tax Act, 1961. 3. Aggrieved from the order of AO, the assessee preferred appeal before the CIT(A), wherein the CIT(A) confirmed the action of AO. 4. Feeling further aggrieved by the order of CIT(A), the assessee is in appeal before the Income Tax Appellate Tribunal. 5. Ld. AR of the assessee submitted that the assessee had maintained books of accounts which were duly audited by the Charte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the entire material available on record, we find that the AO imposed penalty u/s.271A of the Act for non-maintenance of books of account u/s.44AA of the Act. In the appellate proceedings, the CIT(A) upheld the action of AO observing that non-maintenance of books of account by the assessee enabled the AO to levy penalty u/s.271A of the Act. It was also observed by the CIT(A) that other ledger accounts are essential and primary books of account in the absence of which the assessee's income cannot be accurately computed. any reasonable cause for non-maintenance of books of accounts. However, as per the provisions of Section 271A of the Act, If any person fails to keep and maintain any such books of account and other documents as required by s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, there exists cogent reason for imposition of penalty u/s 271AofI.T. Act, 1961. Accordingly, by virtue of section 271A of the Act , penalty of Rs. 25,000/- imposed by the AO on the assessee for failure to keep or retain books of accounts. A conjoint reading of Section 44AA and 271A of the Act, it is clear that the assessee failed to maintain books of accounts, therefore, as per Section 44AA of the Act, the assessee is liable for penalty u/s.271A of Rs. 25000/-. The AO gave opportunity to the assessee for production of books of accounts many times but the assessee did not produce the said books of accounts. Further the assessee submitted that books of accounts have been damaged by white ants and hard disk of the computer in which books ..... X X X X Extracts X X X X X X X X Extracts X X X X
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