9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (9) TMI 597 - AT - Income TaxPenalty u/s. 271B - failure to get his books of accounts audited as per the mandate of Section 44AB - A.O while framing the assessment had, inter alia, initiated penalty proceedings u/s. 271A i.e. for failure on the part of the assessee to maintain books of account and other documents as required u/s. 44AA - HELD THAT - Now when the assessee had been penalized u/s. 271A of the Act, i.e. for not maintaining his books of accounts and other documents as required u/s. 44AA of the Act, then, he could not have further been saddled with failure of getting such books of account which were admittedly not maintained audited. Our aforesaid observation is duly fortified by the judgment of the Hon ble High Court of Allahabad in the case of CIT Vs. S.K Gupta Co 2009 (9) TMI 231 - ALLAHABAD HIGH COURT . As the requirement of getting the books of account audited could arise only where the books of account are maintained. It was further observed that if for some reason the assessee had not maintained books of account, then the appropriate provision under which penalty proceedings could be initiated was section 271A of the Act. On the basis of the aforesaid observations, penalty that was imposed by the A.O on the assessee firm was quashed. Penalty imposed by the A.O u/s. 271B of the Act is quashed. Appeal of assessee allowed.
Issues Involved:
1. Confirmation of Penalty under Section 271B. 2. Opportunity of Being Heard. 3. Penalty Order Barred by Limitation. Summary: Issue 1: Confirmation of Penalty under Section 271B The assessee was penalized under Section 271B for failing to get his books of accounts audited as per the mandate of Section 44AB. The assessee contended that having already been penalized under Section 271A for not maintaining books of accounts, he should not be penalized under Section 271B for not auditing non-existent books. The Tribunal found merit in this argument, referencing the Hon'ble High Court of Allahabad's judgment in CIT Vs. S.K Gupta & Co., which held that if books are not maintained, the penalty should only be under Section 271A, not 271B. Consequently, the Tribunal quashed the penalty. Issue 2: Opportunity of Being Heard The assessee argued that the penalty was levied without providing an opportunity of being heard. The CIT(A) dismissed this contention, stating that notices were issued to the last known address, and the assessee had failed to update his address with the AO. The Tribunal did not dwell on this issue as the penalty was quashed based on the first issue. Issue 3: Penalty Order Barred by Limitation The assessee claimed that the penalty order was barred by limitation as per Section 275(1)(c), which stipulates a time frame for passing penalty orders. The CIT(A) found that the penalty was imposed within the limitation period, considering the appellate proceedings. The Tribunal did not need to address this issue in detail since the penalty was already quashed on other grounds. Conclusion: The Tribunal allowed the appeals, quashing the penalty of Rs. 1,00,000/- imposed under Section 271B for all the assessment years 1993-94, 1994-95, and 1995-96, based on the observation that the assessee could not be penalized under Section 271B after being penalized under Section 271A for not maintaining books of accounts.
|
