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2018 (11) TMI 1943 - AT - Income TaxPenalty levied u/s 271(1)(c) - TP adjustment made to the international transaction - HELD THAT:- As the quantum addition has been deleted by the Tribunal. Thus, the penalty levied has no legs to stand. Considering the above stated position, we dismiss the grounds raised by the Revenue. Penalty u/s 271(1)(c) - mandation to record satisfaction - HELD THAT:- At the time of initiation of penalty proceedings in the assessment, AO did not mention any limb of section 271(1) of the Act whereas at the time of levy of penalty, the AO mentioned the limb stating that the assessee “concealed the particulars of its income”. This manner of recording of satisfaction suggests the existence of ambiguity with reference to applicability of specific limb. Therefore, such penalty order is unsustainable in law legally. It is a settled legal proposition that the AO is under obligation to specify the correct limb at the time of initiation as well as at the time of levy of penalty. In view of the above deliberation on this issue, without going into the merits of the penalty, we are of the opinion that the penalty order is liable to be quashed on this legal issue. Thus, the grounds raised by the Revenue are dismissed.
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