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TMI Blog2019 (3) TMI 1541X X X X Extracts X X X X X X X X Extracts X X X X ..... so not in dispute that qua certain issues (relating to existence of PE / business connection, resulting attribution of income and vendor financing) were remanded back to be decided by the Special Bench and said issue was accordingly decided by the Special Bench [2018 (6) TMI 497 - ITAT DELHI]. It is also not in dispute that the lower revenue authorities have relied upon the order passed in A.Y. 1997-98 and 1998-99. However, now the issue has been decided in favour of the assessee very basis of levying the penalty i.e. addition made in the quantum proceedings, have been deleted / decided in favour of the assessee by the Tribunal as well as Hon’ble High Court the penalty levied u/s 271(1)(c) is not sustainable having been become infructuou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellant prays for leave to add, amend, modify or alter any grounds of appeal at the time or before the hearing of the appeal. 3. Briefly stated that facts necessary for adjudication of the controversy at hand are : the assessee is tax resident of Finland has opted to be taxed in India under the provision of the India- Finland Double Taxation Avoidance Agreement (DTAA) for the year under assessment. Under the Provisions of tax treaty, income derived by the appellant from supply of telecommunication equipment to Indian telecom operators qualifies as Business Profits , which are taxable in India only where and to the extent the same were attributable to Permanent Establishment (PE) of the assessee in India, if any. On the basis of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e s own case reported as [2005] 95 ITD 269 (Delhi) (SB) decided the issue of characterization of revenue s earned from supply of embedded software as royalty and the splitting up of the revenue from supply of equipment between hardware and software in favour of the assessee and the decision rendered by special bench has been confirmed by Hon ble Delhi High Court in DIT vs. Nokia Networks OY [2013] 358 ITR 259 (Delhi). It is also not in dispute that qua certain issues (relating to existence of PE / business connection, resulting attribution of income and vendor financing) were remanded back to be decided by the Special Bench and said issue was accordingly decided by the Special Bench vide order dated 05.06.2018 reported as [2018] 65 ITR (T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Y. 1997-98 are hereby dismissed. 829, 830 831/Del/2008 for A.Y. 1999-2000, 2000-01, 2001-02 9. The Ld. CIT(A) deleted the penalty levied u/s 271(1)(c) on merit by holding that AO has failed to point out any facts or material on the basis of which he had arrived at the conclusion that assessee had either concealed any particulars of income or had furnished inaccurate particulars of income, thus, failed to discharge the primary onus as required u/s 271(1)(c). We are of the considered view that factual findings of the ld. CIT(A) in this regard are well reasoned and do not call for any interference. 10. At the same time, we are of the considered view that when two views were possible, in case assessee adopted a favourable view at t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted that the only point that has to be examined is whether the Tribunal was right in deleting the penalty on the ground that two views were possible when the assessee filed the nil return. He submitted that the best proof of this submission is that the Tribunal itself, when it was considering the quantum appeal in respect of the assessment year 2003-04, was in doubt as to which of the two views were possible. It is for this reason that the matter had been referred to the Special Bench. The learned counsel for the revenue sought to counter the submission by stating that the referral order was passed on 04.04.2007 which is much after the date on which the return was filed and on that date there was no doubt at all with regard to the position ..... X X X X Extracts X X X X X X X X Extracts X X X X
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