आयकर अपीलीय अिधकरण,‘बी’ (cid:7008)यायपीठ,च(cid:7382)े ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH, CHENNAI (cid:7088)ी एबी टी वक(cid:7417), (cid:7008)याियक सद(cid:7021)य एवं (cid:7088)ी बालकृ(cid:7020)णन एस, लेखा सद(cid:7021)य के सम(cid:6979)

BEFORE SHRI ABY T VARKEY, JUDICIAL MEMBER &

SHRI S BALAKRISHNAN, HON’BLE ACCOUNTANT MEMBER आईटीए.नं. /ITANo.258/CHNY/2026 (A.Y.2018-19 A A 540 Thuduppathi Paccs Limited Income Tax Officer, A A 540 ThuduppathiPaccs, Perundurai, Ward-2(1), Erode Nallampatti B.O, Mettupalayam, Erode,638057 [PAN:AABAA8157C]

(अपीलाथ(cid:334)/Appellant) ((cid:366)(cid:529)थ(cid:334)/Respondent)

अपीलाथ(cid:334) की ओर से / Appellant by : Mr. S. Sridhar (cid:366)(cid:529)थ(cid:334) की ओर से/Respondent by : Mr. Shiva Srinivas, CIT सुनवाई की तारीख/Date of hearing : 18.03.2026 घोषणा की तारीख/Date of : 09.04.2026 Pronouncement आदेश/ORD ER PER SHRI S BALAKRISHNAN, ACCOUNTANT MEMBER :

1. This appeal is filed by the assessee against order of Learned Commissioner of Income Tax (Appeals), National Faceless Appeal centre, New Delhi [hereinafter in short “Ld.CIT(A)”] vide DIN & Order No. ITBA/NFAC/S/250/2025-26/1082927989(1) dated 24.11.2025 for the A.Y.2018-19 arising out of the Penalty Order passed u/s 271B of the Income Tax Act, 1961(hereinafter referred to as the “Act”) dated 25.10.2023

2. Brief facts of the case are the assessee filed return of income on 23.03.2019 for the A.Y. 2018-19. The case was selected for limited scrutiny through CASS for the following issues.

i) Investments/Advances/Loans ii) Deduction from Total income under Chapter VI-A Subsequently, notice u/s 143(2) and 142(1) along with detailed questionnaire was issued on 23.09.2019 and 21.12.2020 respectively. The assessee filed its reply on 13.01.2021. Considering the submissions, the assessment was completed determining the total income at Rs.38,02,873/- u/s 143(3) r.w.s 143(3A) and 143(3B) of the Act on 25.02.2021 after disallowing the deductions claimed by the assessee under Chapter VI-A of the Act. The ld AO initiated penalty proceedings u/s 271B of the Act on 10.04.2023 as assessee has not complied with the provisions of section 44AB of the Act. The ld AO observed that the assessee was liable to get its books of account audited for the A.Y. 2018-19 as required u/s 44AB of the Act, but has failed to do so same within the prescribed stipulated time. It was noted that the assessee filed its Audit Report 23.03.2019 whereas the due date for filing the Audit Report was 31.10.2018. Therefore, ld AO called upon the assessee to explain as to why the penalty u/s 271B of the Act cannot be levied for non-filing the Tax Audit report on or before due date prescribed under the provisions of the Act. In response, the assessee submitted that the assessee being a society is subjected to audit under the Tamil Nadu Co-operative Societies Act, 1983 and the Department of Co-operative Audit has not completed the audit. The audit by the department of Co- operative Audit was completed only on 28.10.2018. The ld AO being not convinced to the explanation of the assessee observed that the assessee is liable to get its account audited from the accountantas required u/s 44AB of the Act, since the assessee has exceeded the threshold limit as prescribed. He, therefore, proceeded to levy a penalty of Rs.52,201/- u/s 271B of the Act.

3. On being aggrieved by the penalty order the assessee carried the matter in appeal before the ld CIT(A) but could not succeed. The ld CIT(A) rejected the submissions of the assessee and upheld the penalty levied u/s 271B of the Act.

4. On being aggrieved by the order of the ld CIT(A) the assessee is in appeal before us.

5. At the outset, the ld AR submitted that the assessee was subjected to audit under the Tamil Nadu Co-operative Societies Act, 1983 and the department of Co- operative Audit was completed as late as 28.12.2018. He, therefore, pleaded that the assessee default is not intentional. He submitted that the assessee has filed the Audit Report u