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TMI Blog1993 (7) TMI 154X X X X Extracts X X X X X X X X Extracts X X X X ..... the statements of income along with the returns. According to the assessees, they had maintained the details of income and expenditure account and, were therefore not defaulters liable to be penalised under section 271A of the Act. The Assessing Officer, however, rejected the plea of both the assessees and imposed the penalties of Rs. 2,000 each. When the matter was taken to the D.C.I.T.(A), he held that it has not been proved by the Assessing Officer that the records maintained by the assessee could not be called the books of account or the books of account were such that the same could not enable the Assessing Officer to compute the total income under provisions of the Act. He also gave a finding that the assessees had not shown income on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntain such books of account and other documents as may enable the Assessing Officer to compute his total income in accordance with the Income-tax Act. If an assessee does not maintain such books of account and other documents as may enable the Assessing Officer to compute his total income in accordance with the provisions of this Act, then he will be liable to be penalised under section 271A of the Act. In these cases, no profit and loss account or balance sheet was filed by the assessees along with the returns. Therefore, it was obvious that the assessee did not maintain such books of account as mentioned in section 44AA(2)(ii) of the Act. It was, therefore, submitted that the D.C.I.T. (A) was not justified in cancelling the penalties so i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection (1) concerns people who are referred to as " specified professional people ". Sub-section (2) concerns all other businessmen. This Sub-section is further divided into two clauses. Clause (i) concerns businessmen who are already engaged in their business pursuit. Clause (ii) concerns persons newly taking tip business pursuit. We also find that section 44AA(1) applies not to all professionals but to certain specified professionals. No such rules have been prescribed for the people covered tinder section 44AA(2). In our opinion, any document or books of account which enable an Accountant to prepare a profit and loss account and if possible, a balance sheet will also enable the Assessing Officer to compute the assessee's total income in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch circumstances. We find ourselves in agreement with the submissions made by two amicus curiaes appearing before us that what is a relevant book of account will vary from case to case. In these cases, the penalty proceedings were initiated under section 271A for non-maintenance of bank account. If a penalty under section 271A can be imposed for non-maintenance of bank account, then all the assessees who do not maintain any bank account but write their books of account regularly and maintain cash book and ledgers will be liable fcr penalty. This will lead to an absurd situation. We are, therefore, of the opinion that if an assessee maintains such document which enables an Accountant and not necessarily a Chartered Accountant, to prepare an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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