Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (7) TMI 13 - AT - Income TaxPenalty imposed u/s 271G - assessee has not maintained information/documents required under section 92D(1) r/w rule 10D - assessee applied TNMM for determining of ALP - AO required information/documents for determining of ALP as per CUP method - assessee not able to submit - TPO accepted benchmarking under TNMM - HELD THAT:- The assessee has maintained books of account and other information to benchmark the international transaction with AE by applying TNMM and the transfer pricing study report containing such benchmarking was furnished before the TPO along with various other details. It is not a fact that the 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 variation/adjustment was made by him to the arm's length price. Assuming that the assessee has not maintained documents as required or was unable to support the benchmarking done by it under TNMM, nothing prevented the TPO in discarding the benchmarking done by the assessee and determining the arm's length price of the international transaction with the AE independently by applying any one of the prescribed method. When the statutory provisions confer enough power on the TPO to benchmark the international transaction as per the provisions of the Act, the allegation of the TPO 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 TPO has accepted the benchmarking of the assessee, the imposition of penalty under section 271G is unsustainable. The decisions relied upon by the learned AR dealing with identical issue of imposition of penalty u/s 271G are squarely applicable to the facts of the present appeal. - Revenue’s appeal is dismissed.
|