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2019 (3) TMI 1541 - ITAT DELHIPenalty u/s 271(1)(c) - quantum addition deleted / decided in favour of the assessee by the Tribunal / Hon’ble High Court or remanded by Special bench - Income accrued in India - attribution of income to ‘Permanent Establishment’ (PE) - HELD THAT:- 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 [2012 (9) TMI 409 - DELHI HIGH COURT]. 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 [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 infructuous. - Decided in favour of assessee
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