TaxTMI 
TaxTMI 
2025 (11) TMI 228
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....are that the assessee, a Proprietor of Amul Milk dairy booth, filed his Income Tax Return ('ITR') on 26.07.2017 declaring income of Rs. 2,69,190/-. The case was picked up for scrutiny. Consequentially, the scrutiny assessment was completed accepting the returned income. During the course of assessment proceedings, the Assessing Officer ('AO') noticed that the assessee had neither maintained books of accounts for his business nor got the said books of accounts duly audited though he was required to do so as his admitted turnover was Rs. 2,66,8,989/-. Therefore, the AO initiated penalty proceedings under sections 271A and 271B of the Act for non-maintenance of books of accounts and failure to get books of accounts duly audited in accordance with provisions of sections 44AA and 44AB of the Act respectively. During the course of penalty proceeding, the assessee did not ensure any compliance, therefore, the AO had no option except to conclude penalty proceedings under sections 271A and 271B of the Act as these proceedings were getting barred by limitations. Consequentially, the AO levied penalties of Rs. 25,000/- and Rs. 1,3,30,444/- (0.5% of the turnover of Rs. 2,66,8,989/-) under sect....
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....TA No. 1691/Del/2022 ii. Md. Javed; ITA No. 961/Del/2022 iii. Naresh Kumar; ITA No. 122/Del/2023 iv. Ved Singh; ITA No. 998/Del/2023 v. Nikki Tyagi; ITA No. 5508/Del/2019 vi. Dharm Singh; ITA No. 167 taxmann.com 289 (del. Trib.) vii. Mohit Garg; ITA No. 3355/Del/2017 6. On the other hand, the Ld. Senior Departmental Representative ('Sr. DR'), drawing our attention to the narrations mentioned at page 9 of the ITR (Point No. 1 of Other Information) and in the Computation of income annexed with the ITR; wherein the method of accounting was specifically mentioned as "Mercantile" and income as per the Profit & Loss Account (page 2 and page 13 of the Paper Book), defended orders of the Authorities below and prayed for dismissal of both appeals. 7. We have heard both parties at length and have perused the material available on record. The Hon'ble Supreme Court, in the case of Hindustan steel Ltd. 83 ITR 26 has held that an order-imposing penalty for failure to carry out a statutory obligation is the result of a quasi-criminal proceedings and penalty will not ordinarily be imposed unless the party obliged either acted deliberately....
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....the assessing officer did not impose penalty under Section 271A of the Act and instead proceeded to impose penalty under Section 271B of the Act. If a person has not maintained the accounts book or any accounts the question of its audit does not arise. In such an event the imposition of penalty under the provision contained in Section 271A for the alleged noncompliance of Section 44AA may arise but the provisions of Section 44AB does not get violated in case where the accounts have not been maintained at all and, therefore, penal provisions of Section 271B would not apply. It is well settled by the Apex Court in the case of CIT v. Vegetable Products Ltd. (SC) that if the language is ambiguous or capable of meanings more than one, then we have to adopt that interpretation which favours the assessee, more particularly so because the provision relates to imposition of penalty. The Constitution Bench of the Apex Court in the case of J.K. Synthetics Ltd. v. CTO has held that penalty provision in a taxing statute has to be strictly construed. Penalty is exigible only where a person falls within the four corners of the penal provisions otherwise not. Further in the tax matter interpretati....
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....Rakesh Kumar (1977) 39 STC 520 has held that in a case where no return has been filed penal proceedings can be initiated only under Section 15A(1)(a) and not 15A(1)(b) of the U.P. Sales Tax Act, 1948. It has held as follows: A perusal of the two parts clearly establishes that Section 15A(1)(a) applies in a case where the dealer has failed to furnish the return under Section 7, where Sub-clause (b) applies in a case where the return has been furnished but there is deliberate concealment or the return furnished is inaccurate. The Legislature has in the two sub-clauses mentioned two different categories and has also laid down different penalties in subclause (c). They deal with different situations, and the Sales Tax Officer in this case proceeded under Section 15A(1)(a) and from the amount of penalty imposed, it is clear that he exercised his jurisdiction under Section 15A(1)(b) and not under Section 15A(1)(a). The language of the Section clearly indicates that in a case where no return has been filed penal proceedings can be initiated only under Section 15A(1)(a). There are observations in a decision of the Supreme Court in Narain Das Suraj Bhan v. CST which supports the vi....
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.... case S. Santhosa Nadarv. First Addl ITO 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 sub-section finds place it is impossible to construe Section 28(1)(c) except as relating to a case where a return has been filed but from which return particulars of income have been omitted or any particulars have been deliberately inaccurately furnished. The use of the expression 'particulars of his income' and 'particulars of such income' would be wholly inapposite in a case where no return has at all been filed; such a case ....