I have come across a client whose turnover is above 40 lakhs. This is his first tax audit. He is unaware of legal matters. Now it is one month delay from the last date of filing the returns. What should I do? Should I accept the audit? Is there any other legal way by which I can save my client from legal prosecutions?
12 November 2010
42 days delay. he cannot escape from penalities. but if he finishes the audit the accounts and filing return as soonest he can avoid maximum penality.
for your information, U/s 271B-failure to get accounts audited under section 44AB is half percent of the total sales/turn over/gross receipts. Maximum is Rs.100000/-.
U/s 271F-failure to furnish return of income under proviso to section 139 on or before due date-Rs.5000.
so finish your audit and file the return and approach the assessment commissioner of income tax before issue show cause notice.
filing return of tax audit late should not attract penalty u/s 271B. If your client has got audit report u/s 44AB within prescribed due date then penalty u/s 271B should not attract.
IF you are confident of handling the case, accept the assignment do audit work etc.,
The Audit report shall be dated prior to 15.10.2010 & file the return of income now. If the AO levys the penalty U/s 271F (Rs.5000/-) only as per law, accept it.
AO cannot levy penalty U/s 271B for failure to get the accounts audited U/s 44AB.As the audit is completed before the due date, Only the return the of Inocme is belated for which we are paying penalty U/s271F
If your client already filed return without tax audit details, then revise it & give the tax audit details in it,
If he had not filed return then he have to face the penalty, but make sure that the penalty is not compulsory it discretionary & depend upon how you convince the AO.
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