ORDER
G. SANTHANAM, A. M. :
These appeals are against the levy of penalty under s. 271(1)(a) of the IT Act, 1961. For the asst. yr. 1981-82, the assessee ought to have filed the return of income on or before 30th June, 1981 but the same was filed on 9th Sept., 1983. For the asst. yr. 1983-84, the return of income was due to be furnished on or before 30th June, 1983, but the same was filed on 5th May, 1985. The assessees explanation was that the account books of another firm called “M/s Adam & Joseph” were impounded by the Sales-tax authorities and therefore it was not possible for it to file the returns within the time allowed either under s. 139(1) or under s. 139(2) of the Act. The explanation was rejected by the Assessing Officer (AO) and he levied penalty under s. 271(1)(a) of the Act., in a sum of Rs. 51,100 for the asst. yr. 1981-82 and Rs. 25,712 for the asst. yr. 1983-84.
2. In appeal, the assessee reiterated the same contentions before the first appellate authority and further submitted that inasmuch as interest under s. 139(8) had been levied, there was no case for levy of penalty and for purpose of levy of penalty, the registered firm should not have been treated as unregistered firm. All the contentions did not find favour with the first appellate authority. The assessee is in further appeal.
3. Before us an affidavit has been filed stating that the records of another firm with which the assessee had dealings had been either sized or impounded by the sales-tax authorities and the auditor of the assessee firm was insisting upon the production of such records for him to finalise the accounts and as a result, delay had occurred which was beyond the control of the assessee. The learned Advocate also reiterated before us the same contentions that were advanced at the earlier stages.
4. Sri Balakrishnan, the learned Departmental Representative, submitted that in this case not only the returns were not filed within the time allowed under s. 139(1) but also there was no compliance of the provisions of s. 139(2) of the Act. Further, the assessee had not filed any application in Form No. 6 or otherwise for extension of time. The affidavit now filed should not be accepted as it is not corroborated by any statement of the auditors of the assessee. The reason adduced by the assessee that the delay was due to the impounding of the records of the another firm was rightly rejected by the authorities. Firstly it has to be shown that the accounts of the assessee cannot be finalised unless the details are taken from the books of another firm. The assessee need not depend upon the books of another firm for its transactions with the other firm if the transactions had been recorded as and when they took place and such recording was made true to the nature of the transaction. Such being the case one wonders why the assessee should wait for the scrutiny of the books of accounts of another firm before finalising its accounts. Even if there are differences between the assessees accounts and the accounts of the other firm that can be taken care of in the course of the reconcilation of the accounts and for that purpose one need not necessarily wait for two to three years to finalise ones own account. The insistence of the auditor to have a look at the books of another firm before finalising the assessees accounts, even if it can be taken to be true, cannot be considered as a reasonable cause so as to condone the delay in filing the assessees returns. Hence, the levy of penalty was justified.
5. Having heard rival submissions, we uphold each of the contentions made by Shri Balakrishnan, the learned Departmental Representative. Merely because the accounts of another firm have been either seized or impounded by the sales-tax authorities, the assessee need not have waited for so long to finalise its accounts. If interested, it could have arranged for taking of the copies of its account with the other firm. No effort has been made by the assessee in this direction. Further the assessee can rely on its own account for the transactions with the other firm instead of looking upon the accounts of the other firm to finalise its own accounts. Even if there are differences between the accounts of the firm and the accounts of the other firm, returns could have been furnished with the remarks “subject to the reconcilation or revision”. The affidavit filed by that assessee stating that its auditor was insisting upon the production of the accounts of the other firm before finalising the accounts is to be mentioned only to be rejected because the affidavit is not corroborated by any statement or affidavit filed by the Chartered Accountant referred to in the affidavit of the assessee. For all these reasons, we hold that the assessee did not have reasonable cause for the belated filing of the returns. The penalty levied is confirmed.
6. In the result, the appeals are dismissed.