Commissioner of Income Tax vs Sumer Chand Jain and Sons

Jawahar Lal Gupta, J.—The dispute in this case pertains to the assessment years 1989-90 and 1990-91. Penalty proceedings were initiated against the respondent-assessee for failure to get the accounts audited and to file the return in time. The penalty was imposed. Aggrieved by the

order, the assessee had filed an appeal. It was dismissed by the Commissioner of Income Tax (Appeals). However, the challenge to the order was accepted by the Income Tax Appellate Tribunal. Aggrieved by the order of the Tribunal, by which the orders of penalty in respect of both the assessment years were set aside, the Revenue filed two appeals (viz., Income Tax Appeals Nos. 58 and 59 of 1999).

Mr. Suvineet Sharma appearing for the respondent-assessee states that Income Tax Appeal No. 59 of 1999, has already been dismissed in

view of the judgment in Income Tax Officer Vs. Kaysons India, . Mr. Sharma further points out that the present case is fully covered by the judgment of the Division Bench in the earlier case.

A perusal of the order passed by the Tribunal shows that the assessee had got the accounts audited before the specified date. It was not the

requirement of law, at the relevant time, that the audit report had to be filed along with the return. Still further, the assessee's explanation with regard to the delay in filing of the return has been accepted by the Tribunal. It has been found that the accountant was sick and, thus, the delay had

occurred. In view of these facts, the Tribunal has rightly come to the conclusion that no ground for imposition of penalty was made out.

In view of the decision of the Division Bench in I. T. A. No. 59 of 1999 and in Income Tax Officer Vs. Kaysons India, , we find no ground to

interfere with the order passed by the Tribunal. Resultantly, the appeal is dismissed.

However, the parties are left to bear their own costs.