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TMI Blog2023 (3) TMI 36X X X X Extracts X X X X X X X X Extracts X X X X ..... at exactly law was on particular given day or period without making references to history of enactments. Thus in these circumstances no malafides could be attributed to assessee so as to invoke penalty proceedings under section 271FA and DIT should have taken note that breach was only technical or venial breach of provisions and such breach could have flown from bonafide ignorance of assessee that he was liable to act in manner prescribed by statute, and should not have invoked penalty proceedings. See Durgapur Steel Peoples Cooperative Bank Ltd vs. Director of Income-tax [ 2016 (11) TMI 207 - ITAT KOLKATA] And even if some default was found to be there in filing the SFT, the same at the best was merely a technical and venial breach of law and the conduct of the assessee in the particular has not been shown to be contumacious and no deliberate defiance of law is established on record by the revenue authorities. See Hindustan Steels vs. State of Orissa [ 1969 (8) TMI 31 - SUPREME COURT] . Thus we delete the penalty and allow the grounds of the assessee. - ITA No. 313/JP/2022 - - - Dated:- 11-1-2023 - HON BLE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER Assessee by: Shri S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Add. DIT/JDIT was not satisfied with the reply of the assessee and stated that in guise of reasons the assessee has stated their institutional problems which in any case cannot partake the character of reasons. These are purely Bank s internal administrative and mechanism issues. Therefore, cannot be excused for reasons of delay in filing SFT. In any circumstances, it is the statutory duty of the Bank to file correct statement and in the manner prescribed by the law by due date. The ld. Add.DIT/JDIT (I CI) further stated that the reply submitted by the assessee is for sake of reply only and no where explains the reasonable cause for delay, therefore liable for imposing penalty. After referring the provision of Sec. 285BA, he imposed the penalty as under: As per above provisions of the Act, the total period of default by virtue of Sec. 285BA(1) is 271 days (01.06.2019 to 26.02.2020). Accordingly penalty levied u/s. 271FA of the I.T. Act, 1961 is calculated as under:- For 242 days (01.06.2019 to 28.01.2020) @ 500/- per day Rs.1,21,000/- For 29 days (29.01.2020 to 26.02.2020) @ 1000/- per day Rs. 29,000/- Total Rs. 1,50,000/- In first appeal the ld. CIT(A) confirme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nces due to their old age and lack of knowledge, therefore there were some delay in submission SFT. Bank has regularly filed AIR every year with correct and true information within the due dates. Branch officials has no malafide intention behind delay filing the SFT return, only due the above mentioned reasons SFT return could not be filed with the due date. However the ld. Lower authority has not rebutted our aforesaid reason with the help of any material and has not considered in their true perspective and sense. In the case of Durgapur Steel Peoples Cooperative Bank Limited vs. Director Of Income Tax ITA Nos. 1322 1323 /KOL/ 2013 September 23, 2016 (2016) 48 CCH 0072 Kol Trib It has been held that Penalty Penalty for failure to furnish annual information return Obligation to furnish annual information return Durgapur Steel Peoples Cooperative Bank Limited was entity dealing with borrowing and lending business Under provisions of s 285BA, every person who was assessee or other categories enumerated there and responsible for registering or responsible for registering, or, maintaining books of account or other document containing record of any specified financial transa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d supra found that penalty proceedings were liable to be set aside Both appeals of assessee were allowed 2. Technical breach only : Alternatively and without prejudice to our other submission, even assuming some default was there, the same at the best was a merely technical and venial breach of law and the conduct of the assessee has not been shown to be contumacious. No deliberate defiance of law is established. It has been held that by the Honble Supreme Court in the case of Hindustan Steels v/s State of Orisa 83 ITR 26 (SC). That in order to impose penalty for failure to carry out a statutory obligation is the result of quasi criminal proceedings and penalty will not ordinarily be imposed, unless the party obliged either acted deliberately in defiance of law or was guilty of conduct contumacious or dishonest or acted in conscious disregard of its obligation. The Supreme Court has further laid down that penalty will not be imposed merely because it is lawful to do so. Whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority and is to be exercised judiciously and on a consideration of all the relevant circums ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cause for the delay in furnishing the return of income Hence, assessee trust not liable for penalty u/s 272A(2)(e) of the Act for delay in filing the return of income This principal is also applicable in the present case. As there was no loss to the revenue nor brought on record. In the case of Shyam Gopal Charitable Trust v/s DIT(Exmp.) 290 ITR 99(Del. HC) it has been held that 18. We are of the view that the appellant ought not to be made to suffer penalty, in the peculiar facts of the present case, for having acted upon an advice of its chartered accountant and not filing the IT returns in time. We should not be understood as laying down a general proposition that in all cases where the assessee fails to file returns in time and attributes the failure to an advice by its chartered accountant, that by itself constitutes a sufficient explanation in terms of s. 273B of the Act. Each case would have to be tested on its merits by the authorities concerned or the Court, as the case may be, for coming to a conclusion that sufficient grounds in the context of s. 273B have been made out for not imposing a penalty for the failure to file returns within the time stipulated. 19. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th Rule 114E of I.T. Rules, 1962 for financial year 2018-19 was that the assessee bank was working with 15 branches at different places in Jhalawar district and in some cases branches are situated in rural areas where due to network connectivity problem the report which was required for filing Statement of Financial Transaction (SFT), could not be generated within the due time and thus the said SFT return was filed after due date. In this connection, it was also submitted that the bank has to collect and compile all information received from the different branches but as most of the branch managers are not fully aware with the computer system technology and compliances due to their old age and lack of knowledge, therefore there were some delay in submission of SFT. It was further submitted that the bank has regularly filed AIR every year with correct and true information within the due dates and thus in this way it is apparently clear that branch officials have no malafide intention behind delay in filing of SFT return. According to the ld. A/R, only on the above mentioned reasons that the SFT return could not be filed within the due date. After considering the submissions of both ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A by filing annual information return, same was accepted and assessment was concluded However, subsequently Office of DIT (Intelligence and Criminal investigation) served penalty order levying penalty of Rs.56,100/- for delay of 561 days in furnishing AIR in respect of AY 2011-12 and Rs.19,600/- in respect of AY 2012-13 Held, as matter of fact, DIT (Intelligence and Criminal investigation) who passed penalty order himself observed in his order that assessee got accounts of all branches consolidated and audited, and also filed Income Tax/TDS returns Order of DIT (Intelligence and Criminal investigation) did not speak as to how assessee stood to gain by contravening with provisions of Section 285BA or act of assessee resulted in any loss to Revenue Further, it was acknowledged and judicially recognized fact that tax laws of this country were complex and complicated and often required for compliance, there with assistance of tax practitioners specializing in this field, was well known fact, and it was equally well known fact that legislation in this field underwent so frequent changes and amendments that it was not possible for even person specializing in this field, including tax ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty u/s 272A Assessee, a registered public charitable trust filed return of income belatedly after the expiry of the due date AO levied penalty u/s 272A(2)(e) for not filing the return of income within the due date as prescribed in section 139 of the Act Penalty may be imposed u/s 272A(2)(e) for failure to furnish the return of income in accordance with the provisions of section 139(4A) rws 139(1) An attempt of deliberateness or deceptiveness is associated with the word 'failure' In the present case, there was no deliberateness or deceptiveness in not filing the return of income within the prescribed time limit Assessee was under a bonafide belief that securing recognition u/s 80G would be a pre requisite for filing the return of income However, immediately on being appraised, the income tax returns were filed for all the years without any further delay The delay in filing the return was not intentional or deliberate Since the entire income was applied towards the charitable activities, no tax was payable for the assessment year under consideration As a result of late filing of the return, there was no loss of revenue to the Government Assessee had no ulterior motive t ..... 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