Case law and opinion for filing levy against penalty under section 271B of the IT Act

[DURAISAMY ANANDHAN]

My assesee is a goods transport operator. Since she had not more than 10 vehicles any time during the year she had filed ROI u/s 44AE. Her family members also the same hence they are also filed their ROI u/s 44AE.one year she got a big contract work for 8.00 chores. Hence the assessee got the contract on her name and operated all the family members vehicle for that contract. Please note that there is no written contract between family members and her. But all the contract amount are received through her Bank account only. TDS u/s 194C is also there on her PAN only. After survey conducted in the contractee premises, ADIT came for verification for genuinity of the transaction and instructed orally to the assesee that ROI should be filed on her name only since the entire contract amount was accounted on her PAN. accordingly revised return of income has been filed u/ s 44AB. Now assessment completed u/s 143(3) and levied penalty u/s 271B. Please give opinion and case laws for my assesee

[DR.MARIAPPAN GOVINDARAJAN]

Section 271B povides for penalty if an assessee has not done audit under section 44AB after crossing the threshold limit. In your case it seems whether you are coming under the purview of tax audit. As per the contract made by your client it may be presumed that she will cover under tax audit. If the same is not done the penalty levied is correct.

[DURAISAMY ANANDHAN]

Thank you sir for your early reply. My case is audited u/s 44AB. But audited and filed after the due date.

[DR.MARIAPPAN GOVINDARAJAN]

You may file appeal before the Appellate Authority concerned.

AI Summary

Penalty for failure to conduct tax audit may be upheld where audit was completed after the due date. A transport operator who normally filed under the presumptive transport scheme consolidated contract receipts in her account, filed a revised return and obtained a tax audit after the due date following verification; the assessing officer completed assessment and imposed a penalty for failure to comply with the tax audit obligation, raising the question whether late audit and filing attract penalty when the audit threshold is triggered.