Tribunal cancels penalty for medical practitioner's audit non-compliance The Tribunal canceled the penalty imposed under section 271B on the appellant, a medical practitioner, for not getting his accounts audited under section ...
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Tribunal cancels penalty for medical practitioner's audit non-compliance
The Tribunal canceled the penalty imposed under section 271B on the appellant, a medical practitioner, for not getting his accounts audited under section 44AB of the Act. The Tribunal recognized the appellant's distinct types of receipts and reliance on legal advice as reasonable causes for not obtaining the audit report. It concluded that the appellant acted in good faith, supported by the advocate's affidavit, and that the issue regarding the nature of receipts was debatable. Therefore, the appeal was allowed, and no penalty was imposed under section 271B.
Issues: Penalty under section 271B for not getting accounts audited under section 44AB of the Act.
Analysis: The appellant, a medical practitioner and proprietor of a clinic and diagnostic center, did not get his accounts audited under section 44AB of the Act despite total receipts exceeding the threshold. The Assessing Officer (AO) levied a penalty under section 271B, which was confirmed by the CIT(A). The appellant argued that separate records were maintained for professional receipts, pathological receipts, and sales of medicines, and contended that the provisions of section 44AB were not attracted if these receipts were considered separately. Additionally, the appellant claimed that legal advice received regarding the audit requirement was based on the thresholds not being met. The Departmental Representative disagreed with these submissions.
Upon review, the Tribunal noted that the appellant had distinct types of receipts from different sources, indicating a reasonable cause for not obtaining the audit report. The Tribunal found that the appellant acted in good faith based on legal advice received, which was deemed a reasonable cause in the eyes of the law. The advocate's affidavit attesting to the advice provided further supported the appellant's position. Considering the debatable nature of the issue regarding the nature of receipts and the reliance on legal advice, the Tribunal concluded that no penalty should be imposed under section 271B. Consequently, the penalty was canceled, and the appeal was allowed.
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