""
IN THE INCOME TAX APPELLATE TRIBUNAL "B" BENCH, MUMBAI
. , ,
BEFORE SHRI D. MANMOHAN, VP AND SHRI SANJAY ARORA, AM
./I.T.A. No. 3139/Mum/2013
( / Assessment Year: 2008-09)
Madan S. Kolambekar Dy. CIT, Central Circle-39,
RH-4, Balaji Krupa Complex, / 112, Aayakar Bhavan, M. K. Road,
Plot No.3-A, Sector 28, Mumbai-400 020
Nerul, Navi Mumbai-400 707 Vs.
. / . /PAN/GIR No. AHGPK 9177 R
( /Appellant) : ( / Respondent)
/ Appellant by : Shri M. S. Mathuria
/Respondent by : Shri Love Kumar
/ : 04.02.2015
Date of Hearing
/
: 10.02.2015
Date of Pronouncement
/ O R D E R
Per Sanjay Arora, A. M.:
This is an Appeal by the Assessee directed against the Order by the Commissioner
of Income Tax (Appeals)-41, Mumbai (`CIT(A)' for short) dated 26.02.2013, confirming
the levy of penalty u/s.271B of the Income Tax Act, 1961 (`the Act' hereinafter) for the
assessment year (A.Y.) 2008-09 by the Assessing Officer (A.O.) vide his order dated
29.06.2011.
2. The brief facts of the case are that the assessee did not file his return of income for
the relevant year, due on 30.09.2008, by the said date or even belatedly by 31/3/2009. He,
2
ITA No. 3139/Mum/2013 (A.Y. 2008-09)
Madan S. Kolambekar vs. Dy. CIT
/
being the main person of the Madan Kolambekar Group, was subject to search and
seizure action u/s.132 of the Act on 22.01.2009, and assessment proceedings initiated by
the issue of notice u/s.153A on 20.08.2009. The assessee filed his return, declaring
income at Rs.32.74 lacs, on 20.07.2010, which stood subsequently revised to Rs.111.91
lacs on 08.10.2010, i.e., during the course of the assessment proceedings u/s. 143(3) r/w
s. 153A. The assessment was finally completed on 29.12.2010, at a total income of
Rs.69.25 crores, even as penalty u/s.271(1)(b) stood also levied at Rs.20,000/- for non-
compliance of statutory notices issued during the course of the assessment proceedings.
Penalty proceedings u/s.271(1)(c) were also initiated on 29.12.2010. Further, the
assessee's turnover for the year being at Rs.18.20 crs., his return of income was required
by law to be accompanied by a tax audit report u/s. 44AB, which, rather ought to have
been filed by the due date of filing the return, i.e., 30.09.2008. Notice u/s.274 of the Act,
requiring him to show cause as to why penalty u/s.271B, i.e., for the default of the
provision of section 44AB, which requires obtaining and furnishing a tax audit report as
prescribed where any person's sales, turnover or gross receipts for the year exceeds Rs.40
lacs, be not imposed, was also issued along with, i.e., on 29.12.2010. Further opportunity
was provided to the assessee vide notice dated 10.06.2011. The assessee not filing any
reply to either of the said notices, penalty stood levied at Rs.1 lac, being the lower of Rs.1
lac and one-half per cent of the qualifying amount of total sales, turnover or gross receipt.
Before the ld. CIT(A), the assessee could not make out any case, merely stating that the
default u/s.44AB was involuntary, which was found as without merit, and penalty
confirmed. Aggrieved, the assessee is in second appeal.
3. We have heard the parties, and perused the material on record. The assessee's sole
contention before us, invoking the decision by the apex court in Hindustan Steel Ltd. vs.
State of Orissa [1972] 83 ITR 26 (SC), was of he being not guided properly, so that the
default in non-furnishing or, rather, non-obtaining the tax audit report was not voluntary.
The Revenue's charge that the assessee did not obtain the tax audit report even
subsequently, would not amount to much as obtaining the said report subsequently, i.e.,
3
ITA No. 3139/Mum/2013 (A.Y. 2008-09)
Madan S. Kolambekar vs. Dy. CIT
/
after the due date of furnishing the return of income u/s.139(1) (30.09.2008), would be of
little consequence in view of the amendment to section 44AB w.e.f. 01.07.1995,
requiring the furnishing of the said report by the due date for filing the return u/s. 139(1).
We find the assessee's plea as both presumptuous and without substance. The default of
section 44AB is admitted. The only saving from penalty u/s.271B, i.e., the provision
providing for penalty for the default of the former section, would therefore be s.273B,
i.e., upon proving reasonable cause, toward which, however, the assessee has not made
out any case, i.e., apart from making a bald claim of being not properly informed of the
law. Section 44AB is on the statute book since the year 1984. Its' existence is rather a
matter of common knowledge for the assessees, even as the assessee is a successful
businessman, with the range of economic interests. Why, the different entities in which
he has interest, or are being controlled by him, would be regularly subject to both, the
statutory audit under the governing statute, as well as tax audit u/s.44AB of the Act. In
fact, he being an assessee under the Act would himself be properly instructed by counsels
in the matter. The assessee's claim, which he is in any case obliged to substantiate, is, to
say the least, fanciful. It is for these reasons that we have observed of his case as
presumptuous and without substance. The invocation of the decision in the case of
Hindustan Steel Ltd. (supra) is, again, misconceived. On the contrary, we find the
assessee's conduct, as well as the reason advanced for non-obtaining the tax audit report,
as betraying a lack of bona fides. True, the law stands amended, so that he is required not
only to obtain, but also furnish the tax audit report by the due date specified u/s. 139(1).
However, obtaining the same subsequently, i.e., at the time the assessee claims to have
become aware of having violated the provision, would have only strengthened his claim
with regard to a bona fide conduct and of a genuine mistake, i.e., toward establishing a
reasonable cause, which alone could save penalty. We, therefore, find no merit in the
assessee's case and, accordingly, dismiss his appeal. We decide accordingly.
4
ITA No. 3139/Mum/2013 (A.Y. 2008-09)
Madan S. Kolambekar vs. Dy. CIT
/
4. In the result, the assessee's appeal is dismissed
Order pronounced in the open court on February 10, 2015
Sd/- Sd/-
(D. Manmohan) (Sanjay Arora)
/ Vice President / Accountant Member
Mumbai; Dated : 10.02.2015
. ../Roshani, Sr. PS
/Copy of the Order forwarded to :
1. / The Appellant
2. / The Respondent
3. () / The CIT(A)
4. / CIT - concerned
5. , , / DR, ITAT, Mumbai
6. / Guard File
/ BY ORDER,
/ (Dy./Asstt. Registrar)
, / ITAT, Mumbai
|
