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TMI Blog2018 (10) TMI 1266X X X X Extracts X X X X X X X X Extracts X X X X ..... question of law is admitted by the Hon'ble High Court, the issue becomes debatable and, therefore, no penalty u/s. 271(1)(c) is leviable. Here also substantial question of law has been admitted before the Hon’ble Delhi High Court, as stated by the Ld. Counsel for the assessee, therefore, we grant the stay on the outstanding demand in dispute for the period of 180 days or till the disposal of the Main Appeal X X X X Extracts X X X X X X X X Extracts X X X X ..... made to the customers in India and 35% of these profits were attributable to the marketing activities in India. Accordingly, additions to the tune of 3.5% of the sale were made to the income of the Appellant. 2.1 In light of the above, the income of the Appellant was assessed at ₹ 69,93,234 as against the 'Nil' income declared by the Appellant. The appellant, aggrieved by the aforesaid assessment order filed an appeal before the Commissioner of Income Tax (Appeals) ['CIT(A)']. The Ld. CIT(A) upheld the additions made by the assessing officer ('AO') vide order dated 30.09.2010 by confirming the constitution of Fixed Place PE and Agency PE of the Appellant. Aggrieved by the order of the CIT(A), the Appellant filed an appeal before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ide order dated 15.01.2018 for the same AY on a substantial question of law qua existence of a permanent establishment, therefore, the issue was prima facie debatable and thus, penalty could not have been levied. The copy of the order dated 15.01.2018 passed by the Hon'ble Delhi High Court in ITA No. 621 of 2017 is at Annexure 6. He further submitted that this view of the Appellant is also supported in a very recent judgment dated 04.09.2018 delivered by the Hon'ble Bombay High Court in PCIT vs. Dhariwal Industries Ltd. in ITA Nos. 1129, 1133 & 1136 of 2016. For the sake of convenience, the relevant para of the judgment is reproduced below: "6. In all these appeals, we find that the appeals with reference to the quantum proceedings have b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the primary finding of the AO that the Appellant has fixed place and agency Permanent Establishment in India. We further find that Ld. CIT(A) and this Tribunal have also concurred with these findings of the AO. The Appellant, being aggrieved by the findings of this Tribunal, thereafter, preferred an appeal before the Hon'ble Delhi High Court bearing ITA No. 621 of 2017 which was admitted vide order dated 15.01.2018. The aforesaid appeal was finally heard by the Hon'ble High Court on 24.05.2018 and Judgment was reserved. In the meantime, the AO levied penalty of ₹ 24,93,590/- at 100% of the alleged tax sought to be evaded and raised the impugned penalty demand. On appeal against the said levy, the Ld. CIT(A) also confirmed the pena ..... X X X X Extracts X X X X X X X X Extracts X X X X
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