No Penalty u/s 271B if Tax Audit Report obtained within Time

Whether penalty u/s 271B is leviable in case the tax audit report u/s 44AB is obtained within the due date of filing the ITR u/s 139 but the ITR is filed after such due date?

Earlier, the tax audit report was required to be submitted with the income tax department before the due date of filing of return of Income and in case of likelihood of belated filing of ITR the tax audit report alone was required to be submitted separately before the said due date, otherwise it attracted penal provisions u/s 271B, i.e. half per cent of the total sales, turnover or gross receipts or one lakh rupees, whichever is less.

Presently, the requirement is that one should get the Tax Audit Report from his CA before the due date of submitting the Return of Income and fill the relevant columns of the Return of Income on the basis of such report. The Tax Audit Report is required to be submitted if it is called for by the Income Tax Officer during the Assessment proceedings. This has also been explained in CBDT’s circular No 3 of 2009.

In a way, with the introduction of annexure less forms of Income Tax Returns (i.e ITR4, ITR5, ITR6, etc.) the requirement of submission of Tax Audit Report along with Return of Income has been done away with, i.e. neither the same is required to be submitted with ITR nor the same is required to be filed separately any time before the due date where the return is likely to be delayed.

Therefore, if the tax audit report from C.A. is obtained on or before the due date of furnishing the Return of Income, there is no penalty u/s 271B attracted even if the assessee files return after the due date.

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