2018 (2) TMI 1829 - AT - Income Tax

Penalty u/s.271FA - reasonable cause for delay in furnishing the annual information return - Held that - Appellant is a Govt. servant and AR stated that they have assigned job to submit AIR to some outsources agency and sometime staff of the outsources agency become careless. In these case, appellant is a newly incumbent with the office and was not aware of the income tax provisions. Moreover, department authority did not inform in above said responsibilities of during the same. Moreover, income tax was paid on time therefore, no loss to the revenue. In our considered opinion, appellant was having reasonable cause for delay filing on AIR and in our opinion benefit of section 273B should be given to the appellant. Therefore, we delete the penalty in all above said three appeals - Decided in favour of assessee.

Summary

Issues:
Three appeals against penalty u/s.271FA for AY 2015-16.

Analysis:
In the first appeal (ITA No.1427/Ahd/2016), the department imposed a penalty of &8377; 8,500 for failure to furnish the annual information return. The appellant argued that the delay was due to the newly recruited person in charge who was unaware of tax provisions and responsibilities. The return was filed promptly upon realizing the obligation. The tribunal agreed that there was a reasonable cause for the delay and deleted the penalty, citing Section 273B.

In the second appeal (ITA No.1428/Ahd/2016), a penalty of &8377; 40,200 was imposed for delayed filing of the annual information return. The appellant provided a similar defense regarding the newly recruited person in charge and lack of awareness. The tribunal found the cause of delay reasonable and deleted the penalty, emphasizing compliance post-awareness and the absence of revenue loss.

The third appeal (ITA No.1429/Ahd/2016) involved a penalty of &8377; 8,700 for failure to furnish the annual information return. The appellant reiterated the defense of being newly recruited and uninformed about tax provisions. The tribunal, considering the reasonable cause for the delay and compliance post-awareness, deleted the penalty, granting the appellant the benefit of Section 273B.

The tribunal noted that the appellant, a government servant, had outsourced the task of submitting the annual information return, and attributed delays to the outsourced agency's carelessness. The appellant, being newly appointed, lacked awareness of tax provisions, which the department did not communicate. As the income tax was paid on time and no revenue loss occurred, the tribunal found reasonable cause for the delays in filing the annual information return and granted relief under Section 273B, deleting all three penalties.

In conclusion, the tribunal allowed all three appeals, deleting the penalties imposed under section 271FA for AY 2015-16, based on the reasonable cause for the delays in filing the annual information return and the subsequent compliance post-awareness.