TMI Blog2010 (1) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... nt time, the assessee was required to get its accounts audited and to obtain the audit reports for the assessment years 1989-90 and 1990-91 on 31.10.1989 and 30.11.1990 respectively and there was no requirement to furnish the same independently. Thus, the provision was duly complied with and there was no violation of Section 44AB and, therefore, Section 271B was not attracted – penalty not to be imposed - 135 OF 2000 - - - Dated:- 7-1-2010 - Hon'ble Rajes Kumar, J. Hon'ble S.C. Nigam, J. (Delivered by Hon'ble Rajes Kumar, J.) At the instance of the revenue the following question has been raised for the assessment years 1989-90 and 1990-91: "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was just ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the partner who was looking after the income tax matters was seriously ill and this constituted a reasonable cause for the default. By observing as under, the ld. CIT(A) cancelled the penalties, vide his consolidated order dated 27.11.1995 :- "I have carefully considered the oral as well as written submission of the counsel. So far the legal angle is involved, the contention of the appellant has got to be accepted provided the credence is given to the decisions of the Hon'ble ITAT as cited supra. In this case there is reasonable cause also which is genuine and sufficient as stated supra. Thus from both the angles, the penalties levied by the ITO cannot be sustained. Thus both the appeals are allowed." In appeal by the Department, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed belatedly along with the belated return of income, would not attract imposition of penalty under section 271B of the Act. It has been so held because the provisions of section 44AB, as they stood at the relevant point of time, did not require filing of audit report independently. It was only after realising the lacuna of law that the provisions of section 44AB and section 271B were amended by the Finance Act, 1995, with effect from July 1, 1995, enjoining upon the assessee to furnish the audit report before the specified date. These amendments have not been made retrospective in operation, which fact also confirms that at the relevant point of time, filing of the audit report before the specified date, was not the requirement of law. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... both the audit reports were filed along with the belated returns on 31.1.1990 and 15.4.1991 respectively. In terms of Section 44AB of the Act, as it existed at the relevant time, the assessee was required to get its accounts audited and to obtain the audit reports for the assessment years 1989-90 and 1990-91 on 31.10.1989 and 30.11.1990 respectively and there was no requirement to furnish the same independently. Thus, the provision was duly complied with and there was no violation of Section 44AB and, therefore, Section 271B was not attracted. In the circumstances, the Tribunal has rightly deleted the penalty. In view of above, respectfully following the aforesaid decision, the question referred is answered in affirmative against the Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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