2023 (7) TMI 864 - HC - Income Tax

Penalty u/s 271FA - non-compliance with the provisions of Section 285BA(1)(b) - non filing of a return, despite the petitioner having furnished explanation and shown sufficient and reasonable cause - reasonable cause to excuse their delay of 525 days in submitting the returns - HELD THAT - There is no requirement for any element of mens rea in the light of the specific language of the provisions. It is further stated that the contention raised by the petitioner that he was prevented from submitting the return in time has been specifically considered at paragraph 2 of Exhibit P2 and it was held that the reason stated by the Sub Registrar cannot be treated as sufficient reason for the inordinate delay in filing the returns. It is further contended that no appeal lies to the Tribunal from an order under Section 271FA. The contentions raised by the petitioner that the issue of reasonable cause under Section 273B of the Act has not been considered by the respondents cannot be accepted. The respondents had specifically considered the contention raised by the petitioner and had held that the reasons stated by the petitioner do not constitute a reasonable cause to excuse their delay of 525 days in submitting the returns. It is also clear that though the provision permits the imposition of Rs.500/- per day as penalty only Rs.100/- per day has been inflicted.

Summary

Issues involved:
The imposition of penalty under Section 271FA of the Income Tax Act, 1961 for non-filing of a return despite providing explanation and reasonable cause.

Details of the judgment:
The petitioner, a Sub Registrar, was penalized under Section 271FA for not filing an Annual Information Return (AIR) as required by Section 285BA(1)(b) of the Income Tax Act. The petitioner assumed charge after the due date for filing the report, believing it had been submitted by the predecessor. Upon realizing the error, the petitioner rectified the situation by submitting the data. Despite expressing regret, the penalty was imposed. The petitioner's appeal to the Income Tax Appellate Tribunal was dismissed, leading to the writ petition.

The petitioner argued that the penalty under Section 271FA should be waived as there was a reasonable cause for the delay in filing the return, as allowed under Section 273B of the Act. The petitioner contended that the Tribunal's refusal to consider the appeal was unjustified, especially since the Tribunal itself indicated that the appeal lies with them.

The respondents countered by stating that ignorance of the law is not an excuse and that the delay in filing the return was not justified. They argued that the reasons provided by the petitioner did not constitute a reasonable cause for the delay. The respondents also claimed that no appeal lies to the Tribunal from an order under Section 271FA.

The Court held that the petitioner's reasons did not amount to a reasonable cause for the delay in filing the returns. Despite the provision allowing a penalty of Rs.500 per day, only Rs.100 per day was imposed. The Court concluded that the petitioner's contentions were not acceptable, and thus, the writ petition was dismissed.