TaxTMI 
TaxTMI 
2020 (1) TMI 624
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....an order passed by the Income Tax Appellate Tribunal, Cochin Bench in I.T.A.No.400/COCH/2018, dated 26.06.2019. The assessee is the appellant and the revenue is the respondent. 2. Issue pertains to sustainability of the penalty imposed against the appellant under Section 271B of the Income Tax Act, 1961 ('the Act', for short). The proceedings was initiated based on an allegation that the appellant had failed to furnish report of audited accounts as required under Section 44AB with respect to the assessment year 2014-15. A show cause notice was issued preceding imposition of the penalty, requiring the assessee to show cause as to why penalty under Section 271B should not be imposed. In the reply the appellant said that, as per the ....
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....as found that, filing of Form No.3CA along with a further report by an Accountant is the mandatory requirement and the mere getting of the accounts audited under any other law will not suffice compliance of the said requirement. In the absence of compliance of the provisions contained in the second proviso to Section 44AB read with Rule 6G(1) of the Income Tax Rules,1962, it cannot be said that there is proper compliance of the provision, is the findings . It was also found that the appellant had failed to prove that there existed no 'sufficient cause' for the failure or that there existed any 'reasonable cause' for such failure. Therefore the order of penalty was confirmed. 4. In the second appeal filed before the Tribuna....
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....rieved by the said order, the above appeal is filed by raising the following questions of law. 1 Whether the Assessing Officer is right in imposing penalty when audit report is filed as per the 2nd proviso to S.44AB of the Income Tax Act, 1961? 2 Whether the Assessing Officer is right in insisting for a 'Further Report in Form No.3CA when the proviso very clearly speaks that 'where such person is required by or under any other law to get his accounts audited it shall be sufficient compliance with the provisions of this section? 3 Whether the Appellate Authorities are justified in confirming the penalty imposed by the assessing officer without applying mind while an Audit Report has been submitted as per the proviso to S.44A....
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....e prescribed form, within the date stipulated for the said purpose, it will attract penalty under Section 271B, subject to provisions contained in Section 273B, which is of showing sufficient reasons (reasonable cause). In the case at hand, the appellant had furnished audited financial statement with respect to the year concerned along with a Certificate issued by the Joint Director (Audit) of the Co-operative Department dated 3.7.2018. He has not furnished the report of audit in the prescribed form, Form 3CA, as required under the second proviso (as it stood then) to Section 44AB read with the requirements under Rule 6G(1) of the Income Tax Rules. 8. Contention of the appellant herein is that the submission of audited accounts and statem....
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....e said purpose. It is to be noted that, the further report required by an Accountant need to be furnished in Form 3CD. Evidently the appellant had not furnished the report of the audit under Co- operative Societies Act in the form prescribed, which is Form 3CA. On the other hand, his contention is that the accounts were audited by the Co-operative Department and the Joint Director had issued a Certificate to that effect. Probable contention raised by the appellant is that since the appellant is a person required by the Co-operative Societies Act to get its accounts audited under that Act, the audit report need not be filed in Form 3CA. Even assuming (without admitting) that the furnishing of a report of the audit conducted by the competent ....
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....at, the audited report need not be attached along with the returns or furnished separately at any time before or after the due date; but it need only to be retained by the assessee and produced if it is called for by the Income Tax Authority during any proceedings under the Act. The Circular says that no penalty under Section 271B shall be initiated or levied for not furnishing the tax audit report before the due date. Therefore the imposition of penalty under Section 271B cannot be sustained, is the contention. We are not persuaded to accept the above contention in view of the mandatory provisions contained in Section 44AB, which insists on furnishing of the audit report in the prescribed form before the due date stipulated, along with a f....