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TMI Blog2024 (3) TMI 940X X X X Extracts X X X X X X X X Extracts X X X X ..... eby pass a consolidated order in both the appeals by taking ITA No. 2906/Mum/2023 as the lead case for the sake of convenience. ITA No. 2906/Mum/2023 3. The assessee has in this appeal challenged the penalty levied u/s. 271B of the Act by the ld. Assessing Officer ('A.O.' for short) and upheld by the ld. CIT(A) vide an ex parte order. 4. The brief facts are that the assessee is an individual engaged in the business of trading in plastic bags and also into the business of cheque discounting where the assessee received commission @ 1.5% to 2%. The assessee's case was reopened u/s. 147 of the Act vide notice dated 29.03.2019 u/s. 148 of the Act for the reason that the assessee has deposited cash in his bank accounts and the total tu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has not audited his book of accounts as per the provisions of section 44AB of the Act. Without considering the fact that the assessee's total business turnover was only Rs. 19,05,735/- the ld. A.O. has taken Rs. 1,45,68,340/- as the gross amount of commission received by the assessee. The ld. AR further stated that the ld. CIT(A) had disposed of the appeal without getting into the merits of the case. The ld. AR contended that the ld. A.O. had initiated the penalty proceedings u/s. 271A and 271B of the Act for failure to maintain the books of accounts and for not getting the same audited. The ld. AR contended that the penalty u/s. 271B cannot be levied when the assessee has not maintained his books of accounts and relied on the decision of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er) (supra) has held the same and the relevant extract of the said decision is cited hereunder for ease of reference: 6. After considering the relevant facts placed on record and also the orders passed by the authorities below, we find that the penalty has been levied u/s. 271B for violation of Section 44AB, ie., failure to get the accounts audited. It is not in dispute that assessee has not maintained any books of accounts as required ws.44AA. For violation of non maintenance of books of account u/s. 44AA, there is a separate penal provision for levying penalty for not maintaining of books of accounts prescribed u/s. 271A and therefore if at all penalty should have been levied under this section. The Hon'ble Allahabad High Court in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds of appeal raised by the assessee requires no further adjudication. 14. In the result, the appeal filed by the assessee is allowed. ITA No. 2904/Mum/2023 15. The assessee in this appeal has challenged the penalty levied u/s. 271(1)(c) of the Act amounting to Rs. 53,820/-. As the facts have already been elaborated in ITA no. 2906/Mum/2023, we deem it fit to decide the issue without reproducing the facts. The ld. A.O. in the present case has levied the impugned penalty for the reason that the assessee has concealed the particulars of income during the year under consideration. 16. The ld. CIT(A) upheld the penalty vide an ex parte order dated 22.06.2023 holding that the assessee has failed to substantiate his claim neither by documentar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tribunal in the case of Armoury International (supra) which has held that when the returned income and the assessed income are the same, penalty u/s. 271(1)(c) of the Act cannot be levied. The relevant extract of the said decision is cited hereunder for ease of reference: 6. We have heard both the counsel and perused the records. We find that the assessment in this case has been completed on the returned income. Hence, when the return of income and the assessed income are same, the machinery provision for levy of penalty u/s. 271(1)(c) fails, as the penalty u/s. 271(1)(c) is levied with reference to the tax sought to be evaded, which is the difference between the income returned and that assessed by the A.O. 7. In this case, since t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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