9911796707
TMI Blog2025 (4) TMI 1347X X X X Extracts X X X X X X X X Extracts X X X X ..... subsequent year for setoff. 3. Because the Authorities below also erred in not allowing the claim of the appellant of carry forward of loss to succeeding years despite of established facts that the return of income filed by the appellant was well within time. 4. Because the Authorities below also erred in holding that the appellant was not required to get accounts audited under the Income Tax Act or under any other law for the time being in force, therefore, required to file the return latest by 31st July. 5. Because the Authorities below also erred in not applying the provisions of rule 24(8) of the Limited Liability Partnership Rules in Legal manner. 6. Because the Authorities below also erred in calculating the contribution as per self invented formula by taking Closing Stock less Opening Stock at Rs. 5,35,080/- as against contribution of more than Rs. 1 Crore as required under Rule 24(8) of the LLP Rules 2009. 7. Because the Authorities below also erred in holding that the appellant has not uploaded any Audit Report for the concerned assessment year, therefore, the finding of the Learned Commissioner of Appeals is perverse. 8. The appellant craves leave to add, alt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness loss claimed by the assessee cannot be allowed to be carried forward, as the return of income is filed beyond the time prescribed u/s. 139(1) of the Act. Ld. CIT(Appeals) referred to Rule 24(8) of Limited Liability Partnership Rules, 2009 and observed that auditing of the accounts of the assessee is not required for LLP whose turnover does not in any financial year exceed forty lakh rupees. The assessee was having Rs. Nil Turnover during the year under consideration. The ld. CIT(A) observed that the assessee is having capital work in progress during the year of Rs. 5,35,080/-, which is much less than Rs. 40 lacs. Learned CIT(Appeals) further observed that the assessee has stated in the ITR under the head 'audit details' that the assessee is not liable for audit u/s. 44AB and the audit report for the assessment year 2019-20 has not been filed. Ld. CIT(Appeals) concluded that in view of proviso to Rule 24(8) of LLP Rules, 2009, the LLP is not required to get its books of accounts audited, and also the assessee is not liable to get its books of account audited u/s. 44AB of the Act. The ld. CIT(A) observed that the return of income filed by the assessee is a belated return of inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the assessee's fresh contribution in the year under consideration is less than Rs. 25 lakhs, and the assessee is not liable to get its accounts audited under the LLP Rules. Thus, the due date of filing of the return of income in the case of assessee was 31.07.2019 which was extended upto 31.08.2019. The assessee having filed return of income on 17.09.2019, and hence return of income is a belated return of income which was filed beyond the time prescribed u/s 139(1). It was also submitted that the assessee's turnover is 'Rs. Nil' during the year, which is less than Rs. 40 lakhs, and the assessee was not liable to get its accounts audited under the LLP Rules, 2009. The assessee is also not liable to get its accounts audited under the provisions of section 44AB of the 1961 Act. Thus, it was submitted that the authorities below have rightly disallowed the carry forward of business loss of Rs. 16,96,486/- to subsequent years. 6. I have considered rival contentions and perused the material on record. I have observed that the assessee is a Limited Liability Partnership (LLP). The assessee filed its return of income on 17.09.2019 claiming business loss of Rs. 16,96,486/- for the impug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me filed by the assessee is a belated return of income filed u/s 139(4). If the assessee has filed belated return of income, then the assessee is not eligible to carry forward the business losses to subsequent years. 6.2 Section 34(4) of Limited Liability Partnership Act, 2008 stipulates as under: "The accounts of limited liability partnerships shall be audited in accordance with such rules as may be prescribed : Provided that the Central Government may, by notification in the Official Gazette, exempt any class or classes of limited liability partnerships from the requirements of this sub-section." 6.3 Rule 24(8) of the LLP Rules, 2009 is reproduced hereunder : "(8) The accounts of every limited liability partnership shall be audited in accordance with these rules; Provided that a limited liability partnership whose turnover does not exceed, in any financial year, forty lakh rupees, or whose contribution does not exceed twenty-five lakh rupees shall not be required to get its accounts audited: Provided further that if partners of such limited liability partnership decide to get the accounts of such LLP audited, the accounts shall be audited in accordance with these rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turnover of Rs. 100 crores in a financial year but contribution of Rs. 20 lacs shall not be liable to audit under LLP Act, 2008 read with LLP Rules, 2009, although intention was to exempt small LLP. To deal with such situations where, there is a second proviso to Rule 24(8) of the LLP Rules, 2009, which is an integral part of the Rule itself, which stipulates that if the partners of such LLP(who otherwise is exempted from audit vide first proviso) decides to gets the accounts audited, the accounts shall be audited in accordance with the LLP Rules, 2009 . Thus, once the partners of such LLP decides to get the accounts audited, the same shall be audited as per LLP Rules,2009. Thus, the assessee in the instant case, although having turnover at Nil, but the capital contribution of Rs. 1,31,94,370/- as at 31.03.2019 would not require to get its accounts audited under Rule 24(8) read with first proviso, but owing to second proviso to Rule 24(8), the partners having decided to get the accounts audited, the accounts then shall be required to be audited as per 2009 Rules, which in fact was audited by HAHG & Associates, Chartered Accountant in the instant case. It carries the force of law. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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