Reasonable cause from delayed statutory audit prevents penalty for late tax-audit report submission under cooperative societies law.

Delayed completion of the statutory audit under the Kerala Co-operative Societies law may constitute reasonable cause for late furnishing of a tax-audit report. Where that explanation remains uncontroverted, the applicable jurisdictional High Court ruling supports relief from penalty for delay in meeting the tax-audit reporting requirement. The contrary precedent does not apply once sufficient cause is established. Accordingly, no penalty for delayed furnishing of the tax-audit report is leviable, and the penalty is to be deleted.

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Issues: Whether delay in furnishing the tax-audit report under Section 44AB, caused by delayed completion of the statutory audit under the Kerala Co-operative Societies law, constituted reasonable cause precluding penalty under Section 271B.

Analysis: The delayed completion of the statutory audit was the stated cause for the delay, and that explanation remained uncontroverted. The jurisdictional High Court's ruling that delay in obtaining audit reports from statutory auditors under the Kerala Co-operative Societies law may constitute reasonable cause for delayed submission of the tax-audit report was applicable. The contrary precedent did not apply because sufficient cause for the delay had been established.

Conclusion: The delay constituted reasonable cause; consequently, no penalty under Section 271B was leviable and the penalty was directed to be deleted.

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