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TMI Blog2022 (2) TMI 980X X X X Extracts X X X X X X X X Extracts X X X X ..... come Tax (Appeals) [CIT(A)] has erred both on facts and in law in confirming the action of the AO in levying penalty amounting to Rs. 1,00,000/- under Section 271 BA of the Act on account of not filing the report of the accountant as required by section 92E of the Income Tax Act. 3. On the facts and circumstances of the case, the learned Commissioner of Income Tax (Appeals) [CIT(A)] has erred both on facts and in law in confirming the penalty despite the fact that there being a 'reasonable cause' for not filing the report of the accountant as required by section 92E of the Income Tax Act. 4. On the facts and circumstances of the case, the learned Commissioner of Income Tax (Appeals) [CIT(A)] has erred both on facts and in law in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on account of non-filing of report of accountant as required u/s. 92E of the Act. 5. The ld. CIT(A) confirmed the order of the AO holding that as per the mandate of Section 92E, the assessee was to obtain audit report and file it before the due date for filing the return and since, the assessee defaulted the penalty was rightly levied. 6. Heard the arguments of both the parties and perused the material available on record. 7. MTML is responsible to pay salaries to the deputed employees and the Salary, cost of these employees are a charge on the profits of the Mahanagar Telephone Mauritius Limited (MTML). Also, the employees who are deputed to Mauritius are employees of Mahanagar Telephone Mauritius Limited (MTML) and the said employees a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the said year and the assessment was completed by the AO on 6th October 2016. No ill intention of MTNL could be attributed of evading tax or non- compliance of the tax laws as the report was filed as required by the authorities. 11. From the above mentioned facts and law, it is evident that MTNL was under bonafide belief that it is not required to file form 3CEB but later on realization of the facts and law, MTNL filed the same with the concerned authority. 12. We have gone through the provisions of the Act. 13. Section 271BA reads as under: "Penalty for failure to furnish report under section 92E. 271BA. If any person fails to furnish a report from an accountant as required by section 92E, the Assessing Officer may direct that s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e referred to in the said provisions if he proves that there was reasonable cause for the said failure." 16. Thus, we find that the provisions of Section 273B can be invoked in the case of the assessee as a reasonable cause for failure could be substantiated. 17. Further, in the case of CIT Vs. MP Electricity Board (MP HC) based on the judgment of the Hon'ble Supreme Court in the case of Hindustan Steel Ltd. Vs. State of Orissa held that the authority competent to impose the penalty would be justified in refusing to impose the penalty when there is a technical or venial breach of the provision of the Act are where the breach flows from a bonafide belief that the offender is not liable to act in the manner prescribed by statue. The ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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