TaxTMI 
TaxTMI 
2023 (12) TMI 23
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....the assessee and as such question of audit thereof does not arise. It is hereby thus prayed to delete the penalty so imposed. 2. On the facts and circumstances of the case, the Ld. CIT(Appeals) grossly erred in law and facts by approving the action of the Ld. AO of imposing penalty ignoring the fact that the notice by which the jurisdiction has been assumed by Ld. AO is vague and invalid. It is hereby thus prayed to delete the penalty so imposed. 3. On the facts and circumstances of the case, the Ld. CIT (Appeals) grossly erred in law and facts by approving the action of the Ld. AO of calculating turnover wrongly (by reckoning total deposits as turnover in place of commission receipts) and thus invoking Section 271A of the Income Tax Act, 1961. It is hereby thus prayed to delete the penalty so imposed. 4. On the facts and circumstances of the case, the Ld. CIT(Appeals) grossly erred in approving the action of the Ld. AO of imposing penalty without considering the fact that the order has been passed without affordable reasonable opportunity of being heard to the assessee and hence against the principles of natural justice. It is hereby thus prayed to delete the penalty thus....
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....hereby thus prayed to delete the penalty thus imposed. 5. That the appellant craves leave to add, delete. amend or abandon any or all grounds of this appeal at the time or before the actual hearing of the case." 3. The fact as culled out from the records is that as per information available with the department that the assessee had deposited cash at Rs. 2,90,000/- in her bank account for FY 2009-10 but no return of income was filed for AY 2010-11. After recording reasons and taking prior approval from the Pr. CIT-2, Jaipur, notice u/s 148 was issued on 27.03.2017. The notice was served through post/AD. In response thereto, assessee filed return of income on 13.10.2017 declaring total income of Rs 1,01 860/- under the head "business income" but she has disclosed as commission income. During the proceedings, notice u/s 133(6) was issued to bank and obtain the bank account and other details. On perusal of details received from bank, it is found that assessee is maintained a current bank account in the name of M/s Jaipur Vision Prop. M/s Uma Mandal wherein she has made total credits of Rs. 4,07,45.628/- including cash deposit of Rs. 2.90 lacs on 31.7.2009. Apart from above, it is ....
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....of ld. CIT(A) for levy of penalty u/s. 271A I have considered the written submission filed by the appellant. It is an undisputed fact that the appellant is doing business by name M/s. Jaipur Vision which is engaged in the business of issuing bogus bills to different parties on commission basis. This is also admitted in the return of income filed in response to notice u/s 148, wherein, the appellant has declared commission income at the rate of 0.25%. This is only that the AO increased the commission to 5% as per assessment order. However, the fact remains that the appellant is in the business and the turn over exceeded the prescribed limit. Therefore, I am in agreement with the AO that the appellant failed to maintain books of accounts as required u/s 44AA of the Act During the appellate proceedings, the appellant has also filed additional ground of appeal, wherein, it is stated that no penalty can be levied where the assessment has been made on estimation basis in this regard, it is stated that the penalty under consideration is not penalty u/s 271(1)(c), wherein, the penalty is directly linked to the quantum of addition. The penalty under consideration is u/s 271A which is not ....
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....at the ld. AO has levied two penalty one for non-maintenance of books of account and another for not getting the books of accounts audited u/s. 271A & 271B respectively. The bench noted that in the case of the assessee there has been a levy of penalty for non-maintenance of books of accounts u/s. 271A of the Act and the ld. DR did not controvert the fact and finding of the lower authorities. So, once it has been categorically held that the assessee failed to maintained the books of account and consequent there upon the penalty has also been levied the separate penalty for not getting the books of account audited cannot be fastened. The penalty u/s. 271B can be levied when the assessee maintains the books and does not get them audited but once it is been held and not disputed that the assessee has not maintained the books of accounts how the penalty for not getting the books audited be levied. The ld. DR did not controvert these basic facts. This co ordinate bench in the case of Shahnaz Khanan, Jhalawar Vs. ITO in ITA No. 38/JP/2018 held that : "6. Having considered the rival submissions as well as relevant material on record we note that the assessee has committed the default for....
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....on like that contained in section 28(1)(b), the interpretation we should place upon it must accord with reason and justice and must be in accordance with the plain ordinary and rational meaning of the words contained in those provisions. So interpreted, I would not, in my opinion, be right in placing on section 28(1)(b) the construction for which the learned Government Pleader contends." (p. 133) 12. The Madras High Court in the case S. Santhosa Nadar v. First Addl. ITO [1962] 46 ITR 411 has gone to the extent that a voluntary return filed after the period of four years from the close of the assessment year is not a valid return and such a case should be regarded as if no return has been filed at all and it cannot be said in such a case that there has been a concealment of the particulars of income or deliberate furnishing of inaccurate particulars and section 28(1)(c) of the Income-tax Act, 1922 would not be applicable. The Madras High Court has held as follows : "When we come to section 28(1)(c), it deals specifically with the concealment of 'particulars' of income or the deliberate furnishing of inaccurate 'particulars' of income. In the setting in which this subsection find....
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....our opinion, the imposition of penalty under section 271B is erroneous. The Tribunal has overlooked this aspect of the matter. Of course, it is apparent from the records that the assessee failed to maintain the books of account as required under section 44AA and for that penalty is prescribed under section 271A. It is for the Tribunal to take action in accordance with law. The Delhi Benches of the Tribunal in case of Nirmal Kumar Jain vs. ITO (supra) has held in paras 3 & 4 as under:- "3. In so far as the penalty u/s 271B is concerned, it is noticed that the AO has recorded a categorical finding on page 2 of the assessment order that no books of account were maintained by the assessee. Under such circumstances, a question arises as to whether any pnalty can be imposed u/s 271B for not getting the books of account audited. The Hon'ble Gauhati High Court in SuraiMal Parasuram Todi vs. CIT (1996) 222 ITR 691 (Gau.), has held that where no books of account are maintained, penalty should be imposed for non- maintenance of books of account u/s 271A and no penalty can be imposed u/s 271B for violation of section 44AB requiring ITA Nos.6696 & 6645/Del/2014 audit of accounts. Simila....