M/s. Shark Dyeing Mills Vs. The Income Tax Officer, Ward 1(2), Tiruppur

Parties Involved

Facts Summary

The assessee, M/s. Shark Dyeing Mills, is a firm engaged in the business of textile dyeing and processing. For the assessment year 2018-19, the assessee’s turnover exceeded the prescribed limit, necessitating the filing of an audit report under section 44AD of the Income Tax Act, 1961. However, the assessee failed to file the audit report within the prescribed time. Consequently, the Assessing Officer (AO) imposed a penalty of Rs. 1,50,000/- under section 271B of the Act. Aggrieved by this order, the assessee filed an appeal before the First Appellate Authority (FAA), which confirmed the penalty. The assessee then filed the present appeal before the Tribunal, providing documents such as NCLT proceedings, a death certificate of a partner, and GST returns to show the slowdown in business, arguing that there was a 'reasonable cause' for the late filing of the audit report.…

Legal Issues

• 1. Whether there was a reasonable cause for the late filing of the audit report under section 273B of the Income Tax Act, 1961.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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