Facts of the case: On 21.03.2016, original assessment under section 143(3) was completed and determined the total income of Rs. 26,07,98,030.During the year, assesse failed to carry out statutory Audit and accordingly failed to file the Tax Audit report in prescribed forms.
Due to non-conduct of statutory audit, assessee filed only report in form 3CB and 3CD but not Form 3CA.
Issue involved: Assessee officer had imposed a penalty of as per section 271B of Rs. 1,50,000 for not furnishing statutory audit report in proper form.
Points to be considered:
As per section 44B of the Income Tax Act, 1961 read with rule 6G, it says that “Form 3CA would be required to be filed for a previous year only when accounts for such previous year have been audited under any other law”.
Further Form 3CA is required to be filed in case when the accounts are audited under Companies Act 2013 i.e. the auditors are not required to give a separate audit report.
However, Form 3CB is to be filed when, assessee whose accounts have not been audited and it is mandatory to furnish comprehensive audit report.
The assessee has filed form no. 3CD and 3CB. That means assesse has filed Tax Audit report as per the provisions of Income Tax Act.
The AO has imposed penalty on the ground that audit report should be in form 3CA instead of form 3CB.
Tribunal clarifies that when an assessee had furnished the tax audit report in form no. 3CB then it cannot be said that it has not complied with the provisions of section 44AB merely because the report is not in form no. 3CA.
Conclusion: The Income Tax Appellate Tribunal (ITAT), Kolkata bench has concluded that the filing of form no. 3CB audit report with form no. 3CD is sufficient compliance.
No penalty shall be imposed. Hence, penalty deleted.