TaxTMI 
TaxTMI 
2026 (7) TMI 48
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....hereinafter called 'the Act'). The relevant Assessment Year is 2018-19. 2. Brief facts of the case are as follows: The assessee is a company. For the assessment year 2018-19, it filed its return of income on 27.09.2018 declaring a total income of Rs. 12,00,22,760/-. The return was processed under section 143(1) of the Act by the CPC vide intimation dated 16.10.2019, wherein the total income was determined at Rs. 15,35,25,960/-. Subsequently, the case was selected for scrutiny and notice under section 143(2) of the Act was issued on 22.09.2019. The case was selected for scrutiny primarily to verify the issue relating to non-furnishing of the tax audit report. During the course of assessment proceedings, the AO called upon the assessee to ....
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.... assessee had failed to comply with the said requirement, the FAA upheld the levy of penalty u/s. 271B of the Act. The FAA further observed that the assessee had not established the existence of any reasonable cause within the meaning of section 273B of the Act so as to warrant waiver of the penalty and accordingly, confirmed the penalty imposed by the AO. 4. Aggrieved by the order of the FAA, assessee has filed the present appeal before the Tribunal raising the following grounds:- 1. The learned Commissioner of Income Tax (Appeals), (National Face Less Appeal Centre (NFAC), Delhi (hereinafter known as "CIT(A) NFAC"), erred in confirming the Penalty of Rs. 1,50,000/-imposed by the AO U/s 271B for non-conducting of tax audit U/s ....
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....the head "Income from Other Sources" and the same had been accepted by the Department in the intimations issued u/s. 143(1) of the Act. It was submitted that in the impugned assessment year, during the course of scrutiny assessment proceedings, the Assessing Officer treated the interest income of Rs. 11,84,66,453/- earned on bank deposits as "Business Income" instead of "Income from Other Sources". The Ld. AR further submitted that the reclassification of the income from one head to another did not result in any variation in the taxable income of the assessee and, therefore, no appeal was preferred against the assessment order on this issue. However, it was only because of the AO's action in treating the interest income as business income t....
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....me from Other Sources" and the same had been accepted by the Department in the intimations issued u/s. 143(1) of the Act. It is also not in dispute that in the year under consideration, the AO, during the scrutiny assessment proceedings, treated such interest income as "Business Income", which consequently led to the conclusion that the assessee was liable to obtain a tax audit report u/s. 44AB of the Act. We find merit in the contention of the assessee that the consistent treatment accorded to the interest income in the earlier and subsequent years gave rise to a bona fide belief that the said income was assessable under the head "Income from Other Sources" and that the provisions of section 44AB were not attracted. The Revenue has not bro....