The Chennai bench of Income Tax Appellate Tribunal (ITAT) has recently held that appeal could not be dismissed on ground of assessee filing against Vivad se viswas .Therefore the bench set aside the order passed by the lower authority.
The brief facts of the above case was that , assessee Iyer Gopal Ashokkumar has not filed his return of income for the assessment year 2015-16 under section 139 of the Income Tax Act,1961 .
When a recovery survey conducted on the premises of the department found some printouts of final accounts available in computers of the assessee was taken which revealed that the assessee had taxable income of ₹.12,79,283/-.
Thereafter the assessee case was reopened, after filing the return by the assessee the assessing officer initiated penalty proceedings under section 271B of the Act for reason on without maintained books of accounts as mandated by section 44A of the Act by the assessee.
Aggrieved assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal filed by the assess on the ground that this appeal is filed against VSVS application.
N. Arjun Raj counsel for the assessee submitted that the assessee selected VSV Scheme.under VSVS quantum addition has been settled and the appeal filed against levy of penalty being independent.
AR V Sreenivasan, counsel for the revenue submitted that penalty initiated for failure to furnish tax audit report as required under section 44AB of the Income Tax Act. Therefore the penalty under section 271B of the Income Tax Act cannot be waived.
It was observed by the tribunal that the Assessing Officer has stated that quantum addition settled under VSVS is different from levy of penalty under section 271B of the Act. The Assessing Officer has correctly decided the issue.
Further the CIT(A) ought to have adjudicated the penalty levied under section 271B of the Act on merits of the case instead of dismissing the appeal as infructuous. Hence the order of the CIT(A) is not correct.
Therfore the two member bench of Durga Rao, (Judicial Member) and Manoj Kumar Aggarwal, (Accountant Member) set aside the order of the CIT(A).Allowed the appeal filed by the assessee.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
