Held that the assessee had been established by the\u00a0National Law University, Delhi Act, 2007-the provisions of which indicated that the university was not engaged in any business or for the purpose of profit but existed solely for educational purposes. The penalty order under section\u00a0271B\u00a0of the Act and the assessment order, both specifically mentioned that the assessee was a local authority. Once the Department accepted the assessee to be local authority certainly it could not be considered to be engaged in \u201cbusiness\u201d or to be earning profit, in the ordinary course of its objectives and functions of imparting legal education and legal research in Delhi. Further, the university had claimed exemption of income earned by it from tax under section\u00a010(23C)(iiiab)\u00a0of the Act. The Assessing Officer had erroneously introduced provisions of section\u00a012A(1)(b)\u00a0of the Act to conclude that as the assessee had not got its accounts audited in terms of section\u00a012A(1)(b)\u00a0of the Act, penalty was liable to imposed under section\u00a0271B\u00a0of the Act. In a case of failure of audit for the purpose of section\u00a012A(1)(b)\u00a0of the Act, there is no penalty provision except that the assessee shall not be entitled to the benefit of exempt income under section\u00a011\u00a0or\u00a012. The tax authorities below had fallen in grave error on the facts and law while invoking the penalty provisions.(AY.2018-19)<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 271B : Penalty-Failure to get accounts audited-University-Local authority-Failure to get accounts audited not to result in penalty but only in denial of exemption-Penalty not sustainable. [S. 10(23C)(iiiab), 12A(1)(b), 44AB] <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-44231","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-bvp","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/44231","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=44231"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/44231\/revisions"}],"predecessor-version":[{"id":44232,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/44231\/revisions\/44232"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=44231"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=44231"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=44231"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}