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TMI Blog2023 (5) TMI 1211X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee are as under:- "1. In the circumstances and facts of the case that the learned A.O's order as well as CIT(Appeal)'s order are not justified in the eyes of law. 2. The humble appellant was not liable to have Tax Audit in view of Circular No. F.No.201/3/85-IT(A-II) dated 17/03/1986. 3. That the documents filed before the A.O during the course of proceedings evidently proves that the appellant provided the services only as courier and thus is not liable u/s 44AB of Income Tax Act, 1961. 4. That the certification filed by the appellant for the services rendered on behalf of the principal concern has not been considered by the CIT(Appeal) in appropriate manner and rather has also twisted the A.O.'s remark in his own manner. 5. Tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... violating the provisions of section 44AB of the Act. 4. During penalty proceedings, show cause notices remain uncomplied with. Hence, the penalty of Rs. 1,50,000/- was imposed vide order dated 21.12.2021 under section 271B of the Act against which the assessee filed appeal before the NFAC, Delhi. 5. During the course of appellate proceedings, it was explained that the assessee is engaged in the business of supply of milk (Amul) on behalf of Gujarat Co.op Milk Marketing Federation Ltd. known as "Amul Milk" in the assigned area and its daily proceeds were given to them via bank mode. It was stated that the daily proceeds received by the assessee was firstly deposited by him in bank account maintained by him from where he transferred such d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dence showing that he was acting as commission agent only. In view of this, the assessee's stance that its accounts are not liable to audit u/s 44AB is not acceptable. 4.3.1 Second line of argument is that the previous year was the assessee's first year of business and since he was ignorant about the provision of law and that there was no wilful default. This argument is also not acceptable. The provision of section 44AB is very clear. If turnover exceeds certain prescribed limit, books of accounts are to be maintained and the same have to be audited by a Chartered Accountant. Audit report for the year was uploaded only on 10.10.2019. There was substantial delay in filing the audit report. Considering the facts of the case, I am of the be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . During assessment proceedings as also before the Ld. CIT(A) in penalty proceedings the assessee explained, inter alia that it was his first year of business and that he was under the bonafide belief that the provisions of section 44AB of the Act was inapplicable to him as he was only a commission agent supplying milk on behalf of "Amul Milk" in the assigned area and was entitled to fixed commission only. In our opinion, the explanation offered by the assessee constitutes 'reasonable cause' and the assessee is eligible to the protection envisaged under section 273B of the Act. 11. It is an admitted position that during the course of assessment proceedings, the assessee got the tax audit done and submitted the tax audit report before the L ..... X X X X Extracts X X X X X X X X Extracts X X X X
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