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TMI Blog2019 (7) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has not maintained any information as required under section 92D(1) r/w rule 10D(1). The facts on record clearly indicate that the assessee indeed has maintained a number of information/documents as required under the statutory provisions.The assessee has also explained why it is not possible to furnish certain information sought by the TPO qua applicability of CUP method. Detailed written submission has been filed by the assessee before the TPO which has been properly evaluated by Commissioner (Appeals) and the difficulty in maintaining the information sought by the TPO has been well explained and analysed. It is also necessary to observe, ultimately TPO had accepted the benchmarking done by the assessee under TNMM and no varia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der dated 31st March 2007, passed by the learned Commissioner (Appeals) 55, Mumbai, deleting the penalty imposed under section 271G of the Income tax Act, 1961 (for short the Act ) for the assessment year 2012 13. 2. Brief facts are, the assessee, an Indian company, is engaged in the business of manufacturing and sale of polished diamond as well as diamond studded jewellery. For the assessment year under dispute, the assessee filed its return of income on 28th November 2012, declaring total income of ₹ 35,20,79,030. In the course of proceedings under section 92CA of the Act, the Transfer Pricing Officer called upon the assessee to furnish various information, documents/details to demonstrate that the international ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g him to determine the arm's length price, the Transfer Pricing Officer initiated proceeding for imposition of penalty under section 271G of the Act and ultimately imposed penalty for an amount of ₹ 16,10,56,290. While deciding assessee s appeal challenging the imposition of penalty as aforesaid, learned Commissioner (Appeals) being satisfied with the submissions of the assessee deleted the penalty. 3. Learned Departmental Representative strongly relying upon the reasoning of the Transfer Pricing Officer as contained in the penalty order submitted, as per section 92D r/w rule 10D(1), the assessee is required to maintain information/documents which the Transfer Pricing Officer may require for enabling him to deter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. He submitted, the assessee has made substantial compliance to the queries made by the Transfer Pricing Officer. Therefore, only because segment wise details could not be furnished by the assessee, penalty under section 271G of the Act cannot be imposed. More so, when the Transfer Pricing Officer has ultimately accepted the arm's length price of the international transaction shown by the assessee. In support of his contention, learned Authorised Representative relied upon the following decisions: i) Dilipkumar V. Lakhi, IT(TP)A no.2142/Mum./ 2017, dated 02.08.2018; ii) Kiran Gems Pvt. Ltd., ITA no.5626/Mum./2016, dated 01.11.2018; iii) CIT v/s D. Navinchandra Exports P. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... explained by the assessee that CUP method could not be applied as invoice of sale of AE and non AE include different types of goods sold at different price. It is further observed, in the preceding years also, the assessee had benchmarked international transaction with AE by applying TNMM which was accepted by the Revenue. It is relevant to observe, the Transfer Pricing Officer has ultimately accepted the benchmarking done by the assessee under TNMM method. On going through the provisions of section 92D and rule 10D, we find that the assessee is required to maintain certain information/documents which may be required by the Transfer Pricing Officer for determining arm's length price. In the present case, it is not a fact that the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansfer Pricing Officer that by non furnishing of documents by the assessee he was prevented from determining the arm's length price under CUP method is unacceptable. Therefore, when the Transfer Pricing Officer has accepted the benchmarking of the assessee, the imposition of penalty under section 271G of the Act is unsustainable. The decisions relied upon by the learned Authorised Representative dealing with identical issue of imposition of penalty under section 271G of the Act are squarely applicable to the facts of the present appeal. In view of the aforesaid, we do not find any infirmity in the order of learned Commissioner (Appeals) in deleting the penalty imposed under section 271G of the Act. Grounds are dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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