Penalty u/s 271B

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

12 December 2010 If the company applicable to statutory audit under companies act & the company submitted its provisional return & also tax audit report u/s 44AB within the stipulated time provided u/s 139(1) & then afterwards revise its return after finalising its financial statement on the basis of C & AG. Will penalty u/s 271B be leavied on the basis that how can tax audit be done before finalising the books of accounts.

Deepak Gupta

Deepak Gupta (Expert)
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12 December 2010 No tax audit report is generally issued untill the financial statement are prepared, signed and adopted by the managment of the company. Thus the responsibilty for preparation of accounts is upon the management.

Further, if the tax auditor is of the opinion that the financial statements have any material misstatement, he may issue a qualified or disclaimer report in form 3CA and other particulars as per form 3CD.

Even if the tax auditor issues a qualified or disclaimer report, even then the provisions of section 44AB are complied with. and hence no penalty is leviable u/s 271B.