2012 (10) TMI 205

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ternational transaction during the previous year relevant to the assessment year under appeal. Therefore, the question of arm's length price (ALP) was referred to the Transfer Pricing Officer (TPO). The TPO, in his order passed under section 92CA(3), held that the assessee has not furnished the details of the international transaction in time, as required under section 92D. The TPO reported that the assessee ought to have filed the details within the time limit of 30 days from the issue of first notice, which was issued on 26-8-2008. It was extended to further 30 days on specific request and still the assessee failed to comply with the notice. The assessee had also failed to file the core document, i.e. the Cost Plus Arrangement with its as .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... in the time limit. He accordingly cancelled the levy of penalty. 6. The Revenue is aggrieved and, therefore, in appeal before us. 7. We heard Dr. Sibendu Moharana, the learned Commissioner of Income-tax appearing for the revenue and Shri S. Sridhar, the learned counsel appearing for the respondent-assessee. 8. Section 92D casts a duty on every person who has entered into an international transaction to keep and maintain the information and document in respect thereof, as prescribed under Rule 10D. This duty is cast on an assessee for the reason that the information and document are very crucial for the TPO to examine the issue of ALP while passing an order under section 92CA. 9. Non-observance of the obligation under section 92D is take .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... fast pace to keep up the time limit. In these circumstances, we feel that the assessee had genuine difficulties in presenting the details strictly within the time specified by the TPO. 12. Moreover, in spite of all these things, the TPO has not suggested any adjustment in the ALP reported by the assessee. When that is the case, the default if at all any in the hands of the assessee, turns out to be a technical default. 13. The levy of penalty under section 271G is to be considered in the above circumstances. The penalty prescribed under section 271G is very severe. The quantum of penalty is 2% of the value of the international transaction for each failure on the part of the assessee. If there are more failures on the part of the assessee .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X