2018 (5) TMI 1889 - AT - Income Tax

Penalty u/s 271BA - delay in filing uploaded audit report prescribed U/s 92E - HELD THAT - Assessee has filed audit report during the course of assessment proceedings itself, therefore, applying the proposition of law laid down in JJ. EXPORTERS LTD 2011 (1) TMI 10 52 - ITAT, KOLKATA and RAVI KUMAR RAWAT 2010 (9) TMI 935 - ITAT JAIPUR no justification for levying of penalty U/s 271BA of the Act, therefore, the same is deleted. - Decided in favour of assessee.

Summary

Issues:
Imposition of penalty under Section 271BA of the Income-tax Act, 1961 for delay in filing the audit report prescribed under Section 92E of the Act.

Analysis:

Issue 1: Imposition of Penalty under Section 271BA
The appeal was filed against the order of the CIT(A)-4, Jaipur for the Assessment Year 2014-15 regarding the penalty imposed under Section 271BA of the Income-tax Act, 1961. The assessee had obtained the audit report as required under Section 92E of the Act within the time limit but faced a delay in uploading it online due to technical reasons. The authorized person of the assessee subsequently filed the report online. The assessee contended that all transactions with related parties were on a commercial basis and supported by proper documentation. The Assessing Officer levied the penalty under Section 271BA for the delay in filing the audit report online.

Issue 2: Legal Precedents and Arguments
The assessee argued that since Section 271BA was newly introduced, there was a lack of awareness, leading to the delay in filing the report online. The audit report was filed during the assessment proceedings and was accepted by the Assessing Officer. The assessee relied on judicial decisions, including the ITAT Jaipur Bench and the ITAT Kolkata Bench, which held that penalties under Section 271BA are not applicable in cases of technical or venial defaults if the required reports are filed during the assessment proceedings with all necessary information and evidence.

Issue 3: Decision and Ruling
The ITAT Jodhpur Bench considered the facts of the case and the legal precedents cited. The Bench noted that the assessee had filed the audit report during the assessment proceedings, similar to the situations in the judicial pronouncements. Following the principles laid down in the aforementioned cases, the Bench found no justification for imposing the penalty under Section 271BA of the Act. Consequently, the penalty was deleted, and the appeal of the assessee was allowed.

In conclusion, the ITAT Jodhpur Bench ruled in favor of the assessee, holding that the penalty under Section 271BA was unjustified given the circumstances of the case and the timely filing of the audit report during the assessment proceedings. The decision was pronounced in open court on 25/05/2018.