Delhi High Court
Gavs Laboratories (P) Ltd. vs Dy. Cit on 13 October, 2003
Equivalent citations: (2004)90TTJ(DEL)307
ORDER
R.K. GUPTA, J.M.:
This is an appeal by the assessed against the order of the Commissioner (Appeals) relating to upholding the penalty under section 271B relating to assessment year 1996-97. During the assessment proceeding, the assessing officer noticed that the assessed has not filed complete audit report though the accounts of the assessed were audited in time. Some of the annexures to be enclosed with the audit report were not enclosed while filing the audit report along with the return of income filed on 29-11-1996. The notice under section 271B was issued to the assessed and in reply it was stated that the accounts were audited in time and the report was also filed along with the return under section 139(l). However, assessing officer was not satisfied with the reply because some of the annexures were not enclosed with the audit report. Therefore, he treated the audit report as incomplete and levied a penalty of Rs. 95,918.
2. assessed preferred an appeal before the Commissioner (Appeals). Same submissions were reiterated as were placed before the assessing officer. It was further stated that if there was any default that was technical in nature. Therefore, the same should be ignored. It was also submitted that there was no mala fide intention of the assessed in not enclosing the annexures along with the audit report. In support of4this contention, it was stated that no addition whatsoever was made by the assessing officer on the basis of those annexures which could not be enclosed along with the audit report while filing the return of income. It was also submitted that the annexures which could not be enclosed along with the audit report were filed before assessing officer during the assessment proceedings. After considering the submissions and perusing the other material on record, the Commissioner (Appeals) was not satisfied with the reply filed by the assessed. In his view, the audit report was incomplete because the annexures were not enclosed along with the return.
Therefore, the Commissioner (Appeals) held that the requirements of section 44AB were not fulfillled. Accordingly, he confirmed the penalty levied by assessing officer.
3. Now, the assessed is in appeal before the Tribunal. Learned counsel of the assessed placed reliance on the written subwAwons placed on record. On the other hand, learned departmental RepresentaWe placed reliance on the order of the Commissioner (Appeals).
After considering the relevant material and perusing the material on record, I find that the assessed deserves to succeed in its appeal. There is no dispute though audit of the accounts was completed well in time and that were filed also along with the return filed under section 139(l). The Form 3CB was enclosed along with the return. However, some annexures could not be enclosed along with the audit report, though the balance sheet was also filed by the assessed. At the most, this default can be said to be a technical one. Therefore, in view of the decision of the Hon’ble Supreme Court in the case of Hindustan Steel Ltd. v. State of Orissa (1972) 83 ITR 26 (SC), I hold that there was no mala fide on the part of the assessed in not enclosing the annexures along with the audit report. Therefore, in view of the provisions of section 273B, I hold that there was a reasonable cause in not enclosing the few annexures along with the audit report. Accordingly, I cancel the penalty confirmed by the Commissioner (Appeals).
4. In the result, the appeal of the assessed is allowed.