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TMI Blog2024 (10) TMI 926X X X X Extracts X X X X X X X X Extracts X X X X ..... he income tax portal was not working properly and therefore it had to file manually - HELD THAT:- On similar facts, Tribunal allowed the appeal in the case of Malda District Central Co-op Bank Ltd. [ 2016 (9) TMI 147 - ITAT KOLKATA ] and Durgapur Steel Peoples Cooperative Bank Ltd. [ 2016 (11) TMI 207 - ITAT KOLKATA ] by holding that such a breach was only technical or venial breach of the provisions of the Act and such a breach could have flown from a bona fide ignorance of the assessee that he was liable to act in a manner prescribed by the statute. Considering the submissions of the assessee, it is held that its explanation for not filing of the SFT return due to lack of knowledge is a bona fide explanation given the fact that the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eking it to furnish SFT on or before 10.02.2019 and 20.05.2019. The assessee failed to comply with the said notices. The assessee filed its reply on 30.08.2019 stating nil transaction as the reason for non-compliance but the AO upon examination DQR summary report found that the assessee had actually reported one transaction. He, therefore, levied a penalty of Rs. 81,500/- as per the computation in the penalty order. 4. Aggrieved with the said order, the assessee appealed before the ld. CIT(A). The ld. CIT(A) noted that there was a delay of 255 days in complying to the provisions of section 285BA for which penalty @Rs.100 per day of Rs. 25,000/- was levied and a delay of 112 days default for not complying to the notice issued u/s 285BA(5) fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... steps to combat such actions. In 2003, the 'Annual Information Return (AIR) was introduced under Section 285BA of the Income Tax Act. It was later repealed by the Finance Act of 2014, which renamed it 'duty to produce a statement of financial transaction or reportable account . As per Section 285BA all the reporting entities had to file disclosure in Form 61A or 61B on or before 31 May of the FY immediately following the FY in which the transaction is recorded or registered. 11. Section 285B(1) provide that- .....any person responsible for who is responsible for registering, or, maintaining books of account or other document containing a record of any specified financial transaction or any reportable account as may be prescribed, un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble due to which SFT Reporting was done by submitting it through physical mode. 17. In the light of the aforesaid facts and circumstances, the penalty on assessee due to technical issue on portal will be unfair and unreasonable. 18. Various courts have also held that the penalty u/s 271FA for non-filing or delay in filing of SFT due to ignorance of such provision should not be imposed as breach was only technical or venial breach. The assessee relies on the following rulings: - a) Ruling of Kolkata Bench of ITAT in the case of Malda District Central Co-op Bank Ltd. v. Director of Income-tax (I CI), Kolkata wherein the bench was in agreement with non-imposition of penalty u/s 271FA of Income Tax Act due to aforesaid reason. The relevant para ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atute, and should not have invoked the penalty proceedings. We find every force in the argument of the learned AR and hold that the Penalty proceedings are liable to be set aside. Copy of the ruling is enclosed on page to 36 to 41 of this paper book. b) Ruling of Kolkata Bench of ITAT in the case of Durgapur Steel Peoples' Cooperative Bank Ltd. v. Director of Income-tax (Intelligence Criminal Investigation), Kolkata wherein it was held as under:- On a careful consideration of the matter, it is found that except the instant alleged breach, nothing more is alleged against the assessee. As a matter of fact, the Director (Intelligence and Criminal investigation) who passed the penalty order himself observed in his order that the assessee go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the orders of the authorities below. 6. We have considered the rival submissions and perused the material available on record. The main submission of the assessee is that the return u/s 285BA(1) could not be filed on the ground that the assessee was unaware of the requirement of filing of Form SFT. Further, it submitted that when it tried to file its return, the income tax portal was not working properly and therefore it had to file manually on 9th August, 2019. On similar facts, the Co-ordinate Bench of the Kolkata Tribunal allowed the appeal in the case of Malda District Central Co-op Bank Ltd. vs DIT(I CI), [2016] 72 taxmann.com 306 (Kol. Trib.) and Durgapur Steel Peoples Cooperative Bank Ltd. vs Director of Income-tax (Intelligence C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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