No penalty for getting accounts audited if penalty is already levied:
Shri Pradipbhai Dayabhai Aghara v. I.T.O [ITA Nos. 57 & 58 /RJT/2023] (ITAT Rajkot)
In the present case, the AO has levied penalty u/s 271B of the Act, on account of not getting books of accounts audited as per the provisions of section 44AB of the Act. The order passed by the AO was subsequently up held by the Ld.CIT(A).
Being aggrieved by the order of the learned CIT(A), the assessee is in appeal before the Tribunal.
The Ld. AR before the ITAT, among other contentions, submitted that the assessee has not written up the books of accounts till the date of finalization of audit within the due date specified u/s 44AB of the Act. Accordingly, there was no possibility of getting accounted u/s 44AB of the Act. This offence was committed by the assessee on account of non-maintenance of books of accounts u/s 44AA of the Act, which is complete in itself and therefore there cannot be any penalty under the provisions of section 44AB of the Act.
The ITAT after hearing the rival contentions of both the parties and per used the materials available on record held, the undisputed fact was that the assessee did not file any return of income under the provisions of section 139(1) of the Act. The return was filed in response to the notice issued under section 148 of the Act on account of income escaping assessment. Thus, there remains no ambiguity that the books of accounts of the assessee were not written up before the due date of filing the return of income as specified u/s 139(1) of the Act.
This fact can be verified from the penalty order framed by the AO under section 271B of the Act. Once it was established that the books of accounts were not written up within the due date of filing the return of income, the question of getting them audited to comply with the provision of section 44AB of the Act, does not arise.
As such the first default of the assessee on stand-alone basis is non-maintenance of books of account u/s 44AA of the Act which was complete offence. Therefore, such default i.e. non-maintenance of the books of accounts was subject to the penalty under the provisions of section 271A of the Act.
Regarding the contention of the Ld. DR that the assessee has written up the books of accounts was misplaced. Indeed, the assessee has written up books of account but on a later date. As such, the Ld. DR has not brought any concrete evidence justifying that the books of accounts of the assessee were written up before the due date of filing return of income as specified under section 139 of the Act and therefore the assessee has contravened the provisions of section 44AB of the Act.
In view of the above, and after considering the facts in entirety, ITAT held that the assessee did not maintain the books of accounts within the due date specified u/s 139(1) of the Act, so as to comply with the provisions of section 44AB of the Act. Accordingly, the assessee cannot be visited to the penalty for the offence committed by the assessee for not getting accounts audited. Hence, we set aside the findings of Ld. CIT(A) and direct the AO to delete the penalty levied by him. Thus, the grounds of appeal of the assessee were allowed.
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