- (1.) SINCE both these appeals involve common question of law, the same are being disposed of by this common judgment.
(2.) THESE appeals are directed against the judgment and order of the Income-tax Appellate Tribunal, Jaipur Bench, Jaipur (for short `Tribunal') dt. 20th Oct., 1999. The appeal was admitted in terms of the following question : "Whether the Tribunal was right in law in sustaining the penalty of Rs. 1 lac for each year after proper interpretation of s. 271B r/w s. 273B of the Act ?" The relevant assessment years are 1990-91 and 1991-92. The AO has initiated proceedings for penalty for the asst. yrs. 1987-88 to 1991-92. The turnover of the assessee was more than Rs. 40 lacs. During these three years, the assessee was obliged to file report in Form No. 3CD along with audited balance sheet, P&L a/c with the return as per the requirement of s. 44AB of the IT Act, 1961, (hereinafter referred to as `the Act'), which came into effect from the asst. yr. 1985-86, which requires that each assessee whose turnover is more than Rs. 40 lacs is liable to get its accounts audited by a chartered accountant before the specified date and to obtain an audit report before the due date. The assessee has not submitted the audit report along with the return in all these cases. Therefore, the AO has levied the penalty of Rs. 1 lac for each of the assessment years under s. 271B of the Act. In appeal, before the Tribunal, the Tribunal has also affirmed the penalty levied by the AO. In appeal before the Tribunal, the Tribunal found that there was reasonable cause in the first three years (i.e., for the asst. yrs. 1987-88, 1988-89 and 1989-90) for not filing the audit report as required under s. 44AB of the Act. Hence, the Tribunal cancelled the penalty for these three years. For the asst. yrs. 1990-91 and 1991-92 and Tribunal found that there was no reasonable cause with the assessee for not submitting the audit report as required under s. 44AB of the Act. Hence, confirmed the penalty for these two assessment years. Heard, learned counsel for the parties.
(3.) MR. P.K. Kasliwal, learned counsel for the appellant, submits that in the case of the assessee, the Accountant General is the concerned person and only competent authority to audit the accounts. It cannot get its accounts audited by any other accountant and unless it receives the audit report for the preceding year, it cannot make available the accounts to the Accountant General for audit for the subsequent year. Mr. R.B. Mathur, learned counsel appearing for the Revenue, submits that whether the assessee has a reasonable cause for not submitting the audit report for the years 1990-91 and 1991-92, the Tribunal has considered the explanation in para No. 9 of its judgment and found that for both these assessment years, the assessee has no reasonable cause to file the audit report. Para No. 9 of the Tribunal's judgment reads as under : "9. Now we will take up the penalty issue for asst. yrs. 1990-91 and 1991-92. We noted that the accounts for these two years were handed over to the AG office on 29th Dec., 1990, and 3rd March, 1992. In this way we noted that the accounts book for asst. yr. 1990-91 were handed over to the AG office on the last day of the due date. Being last date on 30th Dec., 1990, the accounts were handed over on 29th Dec., 1990, and accounts for asst. yr. 1991-92 were handed over on 3rd March, 1992. It was beyond the due date. Due date was December, 1991, and the accounts were handed over in March 1992, and we have seen also that final report from 1989-90 was handed over to the assessee on 28th Sept., 1990, and for 1991-92, the audit report was received on 20th Jan., 1992. It means there is no bona fide on the part of the assessee that why it delayed in handing over the accounts to the AG office. Therefore, we are of the view that there was no reasonable cause for getting the accounts audited and seeking report as per provisions of s. 44AB for these two years. Accordingly we confirm the penalties for these two years. Penalties for asst. yrs. 1987-88, 1988-89 and 1989-90 are deleted and the penalties for asst. yrs. 1990-91 and 1991- 92 are confirmed." Mr. Kasliwal, learned counsel appearing for the assessee, has submitted a chart showing the details regarding the specified date of audit, date on which annual accounts of the assessee were rendered to AG office for audit, date on which audit certificate was issued and the date on which the tax report was received. The relevant details read as under : ;