Tribunal directs deletion of penalty under Income Tax Act for late audit report filing

The Tribunal allowed the appeal, directing the Assessing Officer to delete the penalty imposed under section 271B of the Income Tax Act, 1961. The decision was based on the finding that the late filing of the audit report was a technical breach without any malicious intent, as the report was submitted before the completion of assessment proceedings.

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Issues involved:
The issues involved in this case pertain to penalty proceedings under section 271B of the Income Tax Act, 1961 for late filing of audit report under section 44AB of the Act, and the contention regarding the levy of penalty.

Summary:

Issue 1: Penalty under section 271B for late filing of audit report under section 44AB of the Act

The assessee filed the return of income for the assessment year 2017-18 admitting total income. The Assessing Officer initiated penalty proceedings under section 271B for late filing of the audit report under section 44AB. The penalty was levied since the audit report was not filed before the due date. The assessee contended that the audit report was furnished along with the return of income and the assessment was completed based on it. The Tribunal observed a similar issue in a previous case where the penalty was deleted as the audit report was submitted before the completion of assessment proceedings. Following this precedent, the Tribunal held that it was not a fit case for the levy of penalty under section 271B and directed the AO to delete the penalty.

Conclusion:
The Tribunal allowed the appeal filed by the assessee, directing the Assessing Officer to delete the penalty levied under section 271B of the Income Tax Act, 1961. The decision was based on the principle that the late filing of the audit report was a venial technical breach without any mala fide intention, as the report was made available to the AO before the completion of assessment proceedings.

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