9911796707
Advanced Search 
TMI Blog2011 (2) TMI 1399X X X X Extracts X X X X X X X X Extracts X X X X ..... Briefly stated facts of the case are that there was a search conducted in case of one Shri Hitesh M.Bagthariya on 28.6.2006 during the course of which in his statement recorded under section 132(4) he had stated that he was an entry operator and he used to arrange cheques of M/s.Mahasagar Securities Pvt. Ltd. and M/s.Goldstar Finvest Pvt. Ltd. It was also stated by him that Mr. Mukesh Chowkshi, the assessee in this appeal, had floated various companies including his personal capacity for providing accommodation entries to the entry seekers. A survey under section 133A was also carried out on the same day at the business premises of Mr. Mukesh Chowkshi and his concern M/s. Mahasagar Securities Pvt. Ltd. Shri Chowkshi at the time of survey ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reference. The AO observed that under the provisions of section 44AB the assessee was required to get the accounts audited by the accountant and furnish the copy of the same to the AO within the specified date which was the due date of filing the return of income under section 139(1) i.e 31st day of October of the relevant assessment year. Since the assessee had failed to get its accounts audited and furnish a copy of the same before the specified date the AO initiated penalty proceedings under section 271B of the Income-tax Act by issuing the show-cause notice dated 25.5.2009. In response to the show cause notice the Authorized Representative of the assessee filed a reply dated 9.6.2009 stating that all the tax audit reports and other rele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of R.Wadiwala & Co. vs ACIT (72 ttj 34) in which the tribunal had held that turnover of dealing in shares made on behalf of the various buyers and sellers of shares was not includable in the turnover for the purpose of section 44AB. It was pointed out that the AO himself had not initiated penalty proceedings in the earlier years and that the AO had not issued defect memo under section 139(9) of the Income-tax Act for defect in the return. The assessee also referred to the CBDT circular No.452 dated 17.3.86 in which the Board had clarified that in case of Kaccha Arathia only the commission was to be considered for the purpose of determining the applicability of section 44AB. CIT(A) however did not accept the contentions raised. It was no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s therefore violation of provisions of section 44AB in this case and CIT(A) accordingly confirmed the penalties levied by the AO. Aggrieved by the said decision the assessee is in appeal in all the three years. 5. Before us the Learned AR for the assessee reiterated the submissions made before lower authorities that audit had been conducted and audited accounts had been filed with the return of income. It was also pointed out that in other years audited accounts had been filed and no penalty had been imposed. The Learned AR also filed affidavit dated 7.2.2011 both from the assessee and the CA Shri S.M.Bhatt and requested that the same may be admitted. In that affidavit the assessee has stated that the Chartered Accountant Mr. Bhatt had inf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adduce any evidence. The AO had issued show cause notice as to why penalty should not be imposed for non compliance of provisions of section 44AB. The assessee had also been confronted with the original returns filed which showed that no audited accounts had been filed. The assessee had also opportunity to file any additional evidence or any affidavit before the CIT(A) which had also not been done. We have also no difficulty in deciding the issue on the basis of material available on record because filing of audited accounts could be easily verified from the records which have already been gone into by the authorities below and the assessee has not produced any acknowledgment receipt etc even at this stage. Even if these affidavits are adm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Authorized Representative of the assessee in the penalty proceedings. But they did not even file the copy of the audited accounts and audit reports even during the penalty proceedings. Considering the entirety of facts and circumstances we have to hold that the authorities below had rightly concluded that no audited accounts and audit reports had been filed by the assessee. We also note that under section 44AB the audited accounts were required to be furnished to the AO within 31st October of the relevant assessment year and even if the assessee's conversion was to be accepted for the sake of arguments that the audit reports had been filed with the return of income these had been filed much after the due date i.e. 31st October of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
