I am a practising Professional. I have a query. Some of my clients will be in a position to obtain the audit reports under section 44 AB before 31-10-2007. But keeping in view the lengthy FORM No. 4 and 5 , they shall not be in a position to furnish the income tax Returns before 31st October 2007.
My query is where my assessee obtains the Tax audit report u/s 44 AB before 31-10-2007 but files his returns in November 2007, i.e after the due date , whether the penalty u/s 271B shal be imposed. This question is relevant , particularly in the light of the latest circular No. 5/2007, where in the audit report is not to be attached with the return of income , nor the same is to be filed separately
14 October 2007
6. Following clarifications are also issued in respect of certain issues arising from furnishing the returns in the respective forms:
(i) The report of audit under section 44AB is not to be attached with the return. It should not be furnished separately also before or after the due date. However, an assessee should get the report of audit from an accountant under said section before the due date of the furnishing of the return and should fill out the relevant columns of these forms on the basis of such report. The assessee should retain the report with himself. It may be furnished in original during the assessment proceedings. No penalty under section 271B shall be initiated or levied for not furnishing the tax audit report on or before the due date. However, if the audit report has not been obtained before the due date, provisions of section 271B shall be attracted.
(ii) These returns are not to be accompanied with any other document including any statutory form or report of audit (other than the report under section 92E) which is otherwise required to be furnished before the due date or along with the return for making any claim. The provisions of the law shall be deemed to have been complied with in respect of the requirement of the filing of the attachments or documents or reports along with the return. No penalty shall be initiated/ levied for not furnishing such documents if such documents were otherwise obtained before the specified date, if any, provided in the statute. All these documents should be retained by the taxpayers and be furnished in original during the scrutiny proceedings.
(iii) The report as required under section 92E of the Income-tax Act shall continue to be furnished before the date specified in rule 10E.
(iv) In case, a return is furnished under digital signature, the date of such furnishing shall be the date of furnishing the return. In case, the assessee chooses to transmit the data in the return electronically and thereafter submit the verification of the return in form ITR-V, the date of transmitting the data electronically will be the date of furnishing the return if ITR-V has been furnished within fifteen days from the date of transmitting the data electronically. In case, Form ITR-V, is furnished after the above mentioned period, the date of furnishing Form ITR-V shall be deemed to be the date of furnishing the return. Further, in case, Form ITR-V is not furnished, it will be deemed that no return has been furnished.
(v) The e-Return has to be furnished at http://incometaxindiaefiling.gov.in. The ITR-V shall be furnished at separate counter(s) to be set up exclusively for this purpose at each local income-tax office (whether on net-work or not).
(vi) The ITR-V Forms are bar-coded. Therefore, CCITs/ CITs must ensure that these Forms are handled and stored with care and caution. While storing the returns, precaution should be taken not to fold them. These ITR-Vs should be sent to the RCCs immediately.
7. Separate instructions regarding the procedure for processing the returns filed electronically and verified in Form ITR-V are being issued separately.
8. The returns filed electronically shall be processed on priority basis.
19 November 2007
No penalty can be levied if the audit report is obtained before 31/10/2007. Department is bound by circular no. 5 issued in the month of July-2007. Even the same reply is being provided by Ayakar Sampark kendra over telephone.
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