Audit report filed with a belated return cannot sustain penalty where statutory compliance was otherwise completed.

Penalty under section 271B was not sustainable where the audit report under section 44AB had been obtained before the specified date and was filed with a return under section 139(4), even though not with the return under section 139(1), and no notice under section 142(1) had been issued. The Court followed its earlier decision on the same question and held that the assessee's compliance with the audit requirement was sufficient on the facts, so the penalty could not be upheld. The reference was answered in favour of the assessee.

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Issues: Whether penalty under section 271B of the Income-tax Act, 1961 was leviable when the audit report under section 44AB had been obtained before the specified date but was filed along with a return under section 139(4) and not under section 139(1), and no notice under section 142(1) had been issued.

Analysis: The assessee's assessment had been completed under section 143(3), and penalty was imposed under section 271B for alleged non-furnishing of the audit report. The Tribunal had set aside the penalty. The reference was covered by an earlier decision of the Court on the same question, which had answered the issue in favour of the assessee.

Conclusion: The reference was answered in favour of the assessee, and the penalty under section 271B was not sustained.

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