https://www.taxtmi.com/caselaws?id=11707 Penalty for delayed audit report under section 271B is not automatic. Reading sections 44AB, 271B and 139(9) together, the Madras High Court noted that the audit-report requirement is mandatory, but penalty can be imposed only through a judicial exercise of discretion and may be declined where reasonable cause is shown. On the facts, the return was filed in time, the audit delay arose from the statutory audit process under the Tamil Nadu Co-operative Societies Act and Rules, and the assessee had no control over auditor appointment. As no deliberate or contumacious default was established, the penalty was set aside. en-us Tue, 18 Sep 2001 00:00:00 +0530 Sat, 06 Feb 2010 11:38:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=11707 Penalty for delayed audit report under section 271B is not automatic. Reading sections 44AB, 271B and 139(9) together, the Madras High Court noted that the audit-report requirement is mandatory, but penalty can be imposed only through a judicial exercise of discretion and may be declined where reasonable cause is shown. On the facts, the return was filed in time, the audit delay arose from the statutory audit process under the Tamil Nadu Co-operative Societies Act and Rules, and the assessee had no control over auditor appointment. As no deliberate or contumacious default was established, the penalty was set aside. Case-Laws Income Tax Tue, 18 Sep 2001 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=11707