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2022 (2) TMI 1060 - AT - Income TaxPenalty levied u/s 271G - Assessee has failed to maintain the information as per Rule 10D (1) (d), (g), (h) and (m) of Income Tax Rules - ‘reaso-nable cause’ under section 273B - assessee had made substantial compliance, failing to note that under TNMM adopted by the assessee, the profit of the international transaction has to be furnished, whereas the assessee has only furnished the entity level margins which consists of overall profits on AE and significant non-AE transactions - CIT (A) deleted the above penalty. He held that the Transfer Pricing Officer was not prevented and was not forced to accept the ALP methodology adopted by the assessee. He has not made use of the details submitted by the assessee, which were lot wise details of exported cut and polished diamonds - HELD THAT:- As requisite detail asked during the Assessment Year 2011-12 were not required for earlier years and no adjustment was made. Therefore, the details asked for by the learned Transfer Pricing Officer may be relevant for determination of Arm’s Length price. But was asked for the first time, not question by ld TPO in past TP Assessments, therefore, assessee has a belief that such information is not required as well as not available, therefore , the assessee has ‘reasonable cause’ under section 273B of the Act for not maintaining the same. For failure as envisaged subject to penalty u/s 271G, if such failure is because of reasonable cause, no penalty can be levied. Thus, we find no infirmity in the order of the learned CIT (A) in deleting the penalty. The various judicial precedents stated before us are also to the same effect. There is a ‘reasonable cause’ for failure on the part of the assessee, which saves assessee from levy of penalty under, section 271G of the Act. In the Result, we dismiss the appeal of the learned Assessing Officer. - Decided in favour of assessee.
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