The assessee was in the business cloth trading. The assessee was asked to explain the source of certain cash deposits in his bank account. The assessee submitted that the amount was collected from ‘feriwalas’ (peddlers) against cloth supplied to them and commission at 1% was earned on purchased cloth. Income from commission had been duly offered to tax. The total turnover of the assessee including the commission income was below the limit for tax audit provided under section 44AB of the Income-tax Act, 1961. The AO rejected the assessee’s explanation and computed the net profit of the wholesale business at 9.1% on the undisclosed turnover and made further additions. He initiated penalty proceedings under section 271B for failure to get the accounts audited under section 44AB, since the declared turnover of the assessee was increased by the turnover of cash deposit in the bank account. The Commissioner (Appeals) confirmed the levy of penalty. On appeal, the Tribunal held that the assessee had bona fide treated the commission income as turnover along with other turnover accounted in his books of account during the year 2012-13 which was below the limit under section 44AB. The AO was not right in treating the unaccounted turnover as part of the total turnover and hold the assessee liable for penalty under section 271B for not getting his books of account audited. The penalty was liable to be deleted. (AY 2011-12)