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2019 (5) TMI 319 - DELHI HIGH COURTPenalty u/s 271(1)(c) - TP adjustment - arithmetic mean of the profit margin of the comparable was at 13.41% only. However, the assessee offered the amount lower than that, on the basis of its actual income to the profit margin - ITAT set aside the penalty imposed - Revenue emphasised that Explanation (7) was for the purpose of international transactions undergoing transfer pricing and u/s 92CA, if a larger amount was determined by the TPO, the difference between what is offered and what ought to have been offered becomes not only taxable but subject to penalty - HELD THAT:- This Court is of the opinion that in the given facts of this case, the issue at best is debatable. It is also important to notice that during the proceedings, it became evident that the assessee had wound up the operations. What the TPO and later the AO desired the assessee to do, was to include in hindsight, the income amounts which it had not received and offer a higher rate of return or profit. The Court is of the opinion that the setting aside of the penalty amount cannot be characterised as unreasonable. No substantial question of law arises.
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