THE HON'BLE THE CHIEF JUSTICE UJJAL BHUYAN
AND
THE HON'BLE SRI JUSTICE C.V.BHASKAR REDDY
I.T.T.A. No.72 of 2006
JUDGMENT: (Per the Hon'ble the Chief Justice Ujjal Bhuyan)
Heard Mr. A.V.Siva Karthikeya, learned counsel representing
Mr. A.V.Krishna Kaundinya, learned counsel for the appellant and
Mr. J.V.Prasad, learned Standing Counsel, Income Tax
Department for the respondent.
2. This appeal has been preferred by the assessee as the appellant under Section 260A of the Income Tax Act, 1961 (briefly referred to hereinafter as the 'Act'), assailing the legality and validity of the order dated 08.04.2005 passed by the Income Tax Appellate Tribunal, Hyderabad Bench 'B', Hyderabad (Tribunal) in I.T.A.No.164/Hyd/1999 for the assessment year 1995-96.
3. Though the appeal was filed way back in the year 2005, the same is yet to be admitted. Only notice was issued on 15.02.2006.
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4. Be that as it may, the question proposed by the appellant for consideration of the Court as a substantial question of law as can be discerned from the memo of appeal is as under:
Whether on the facts and in the circumstances of the case, the Tribunal was justified in upholding the order of the Commissioner of Income Tax (Appeals) confirming levy of penalty of Rs.1,00,000.00 by the assessing officer?
5. Appellant is an assessee under the Act and was a Bookie at Hyderabad Race Club. For the assessment year 1994- 95, he filed his return of income declaring total income of Rs.5,82,490.00. Assessing officer noted that appellant had not complied with the provisions of Section 44AB of the Act i.e., by submitting audited accounts, levied penalty of Rs.1,00,000.00 under Section 271B of the Act.
6. In appeal before the first appellate authority i.e., Commissioner of Income Tax (Appeals), order passed by the assessing officer was affirmed. This led to filing of further appeal before the Tribunal.
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7. Tribunal in the order dated 08.04.2005 held as follows: "6. We have heard rival contentions. On a careful consideration of the facts and circumstances of the case, we find that a notice under sec. 148 was issued and it was only in response to that notice that the assessee had filed his return of income. The entertainment tax return of the assessee shows that his turnover is Rs.3,37,70,270. The assessee paid entertainment tax. Subsequent to the notice given by the AO for levy of penalty under sec. 271B, the assessee claimed that he was under a genuine belief that his turnover had not crossed Rs.40 lakhs and he need not get his accounts audited. While saying so, he filed additional evidence stating that due to seizure of books by the Sales tax authorities, the audit of accounts under sec. 44AB got delayed. This is a contradictory stand. As the assessee bona fide believed that his accounts need not be audited, he would not have taken a plea that the audit got delayed due to seizure of books by the Sales tax authorities. Having paid entertainment lax on a turnover of Rs.3,37,70,270, the assessee cannot claim that he believed that his turnover was much below that amount. The return itself was not filed voluntarily, but in response to a notice under sec. 148. The argument of the learned counsel for the assessee that the penalty was levied much prior to completion of assessment also, does not come to the rescue of the assessee as nothing in law prevents the AO from levying penalty under sec. 271B prior to completion of assessment proceedings.
7. The petition for admission of additional evidence cannot be entertained at this stage as before the CIT (A) no plea was taken that due to seizure of books by Sales tax authorities the audit got delayed. Even otherwise, no copy of letter from the 4 HCJ & CVBRJ I.T.T.A.No.72 of 2006 Sales tax authorities is filed before us. The two letters dated 28-8-1996 and 25-3-1997 are of the assessee written to the Commercial Tax Officer, and are self-serving.
8. In view of the fact that the assessee himself filed entertainment tax return and paid tax on a turnover of Rs.3,37,70,270, we are inclined to upheld the order of the CIT (A) and confirm levy of penalty of Rs.1,00,000.
9. In the result, the appeal of the assessee is dismissed."
8. Thus Tribunal noticed that subsequent to notice issued by the assessing officer for levy of penalty under Section 271B of the Act, appellant had claimed that he was under a genuine belief that his turnover had not crossed Rs.40 lakhs and therefore he need not get his accounts audited. It may be mentioned that the entertainment tax return of the appellant showed his turnover at Rs.3,37,70,270.00. Tribunal further noted the contradictory stand of the appellant when he contended that due to seizure of books by the sales tax authorities, audit of accounts under Section 44AB of the Act got delayed. Additionally Tribunal held that appellant did not file the income tax return voluntarily but it was in response to a notice under Section 148 of the Act.
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9. In view of above, Tribunal confirmed the levy of penalty.
10. We do not find any error or infirmity in the view taken by the Tribunal. No question of law arises out of the aforesaid order of the Tribunal dated 08.04.2005, not to speak of any substantial question of law.
11. The appeal is accordingly dismissed. However, there shall be no order as to costs.
12. Miscellaneous applications pending, if any, shall stand closed.
__________________________ UJJAL BHUYAN, CJ ___________________________ C.V.BHASKAR REDDY, J Date: 02.11.2022 KL