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TMI Blog2023 (7) TMI 332X X X X Extracts X X X X X X X X Extracts X X X X ..... il sale of Petrol & Diesel. The case was selected for complete scrutiny under CASS and assessment was completed u/s 143(3) of the Income Tax Act, 1961 at an assessed income of Rs. 23,11,260/- on 21.12.2019. As per assessment order, the total turnover of the assessee is Rs. 20,88,24,297/-, therefore, she was under obligation to get her books of accounts audited as per provisions of section 44AB of the Income Tax Act, 1961 and submit the audit report within stipulated time. The assessee furnishes the said audit report on 08.11.2018 i.e. after the due date, thereby, failing to comply with the provisions of section 44AB of the Income Tax Act, 1961. Accordingly, a notice u/s 271B was issued to the assessee on 21.12.2019 for not complying with the statutory provisions of the Act. The ld. AO while levying the penalty u/s. 271B noted that the reason offered by the assessee is not correct and just and afterthought and merely an excuse to escape the penal proceedings. She was not prevented by an reasonable cause to comply the with the mandatory provision of the Act, as such the reply of the assessee is not tenable. Based on these observation order of levying penalty u/s. 271B for an amount o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00/- u/s 271B of the Act. 3. The Ld. CIT(A) held that the tax audit was not completed on or before the due date of 07/11/2017. The Tax audit u/s 44AB was completed only on 08/11/2017 with the signing of the accountant and thereafter it was submitted online. Thus, he upheld the levy of penalty u/s 271B. 4. It is submitted that the audit report in Form 3CB was signed by the tax auditor on 07.11.2017 as per Form No. 3CB as downloaded from the e-portal of the assessee (copy enclosed). Thus, the audit was completed & audit report was obtained on 07.11.2017. However, it was digitally signed by the auditor and assessee on 08.11.2017 at 09.27 PM and uploaded. The assessee explained such delay of 1 day due to technical glitches. This constitutes a reasonable cause. Section 273B provides that no penalty shall be imposable on the person or the assessee for any failure referred to in section 271B if he proves that there was reasonable cause for the said failure. The AO has otherwise considered this audit report in completing the assessment. Never in past or in subsequent years there is any delay in obtaining & filing the audit report. Therefore, default if any, is only a technical venial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regarded as contumacious or with a view to evade payment of tax. If at all there is any breach, it was technical or venial in nature. In the facts of this case, no case of penalty under s. 271B was made out. Impugned order passed by Tribunal is set aside. John Biwheelers Vs. ACIT (2019) 70 ITR 325 (Cochin) (Trib.) The head note of the decision reads as under:- Penalty-Failure to get accounts audited-Assessee filed return of income-During assessment proceeding, AO noted that assessee was liable to get its accounts audited as per provisions of s. 44AB on or before due date of filing of return of income-However, assessee got its accounts audited only on 28/03/2014-Therefore, there was delay in getting accounts audited and therefore, penalty u/s 271B was levied for failure to comply with provisions of s. 44AB subject to provisions of s. 273B-CIT(A) confirmed AO's action-Held, assessee got his books of accounts audited on 28/03/2014 which was made available to AO and no prejudice was caused to Revenue-Assessee had only committed technical venial breach which does not create any loss to exchequer as audit report was available to AO before completion of assessment proceedings-Hig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cision cited by the ld. AR of the assessee in support his arguments before us. The ld. DR did not controvert the fact there is delay of only one day in filling the audit report by the assessee. The ld. AR of the assessee contended that the assessee explained that it got the accounts audited and obtained the tax audit report on 07.11.2017 but due to some technical glitches it was submitted on 08.11.2017 so there is one day delay. The ld. CIT(A) hold a view that the audit was completed on 08.11.2017 and therefore confirmed the penalty. Be it may so, the bench noted that there is only one day delay in filling the audit report by the assessee. The provision related to the levy of penalty reads as under : Failure to get accounts audited. 271B. If any person fails to get his accounts audited in respect of any previous year or years relevant to an assessment year or furnish a report of such audit as required under section 44AB, the Assessing Officer may direct that such person shall pay, by way of penalty, a sum equal to one-half per cent of the total sales, turnover or gross receipts, as the case may be, in business, or of the gross receipts in profession, in such previous year or y ..... X X X X Extracts X X X X X X X X Extracts X X X X
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