The Appellate Tribunal considered a case involving a penalty u/s...

The Appellate Tribunal considered a case involving a penalty u/s 271(1)(C) for a defective notice related to TP adjustments. The AO determined arm's length OP/OC at 13.87% and made net additions based on differences in figures. The notice lacked specificity on the section invoked, contrary to legal requirements. Citing relevant case law, it was held that ambiguity in the notice is not sustainable. The provisions of Explanation-7 to section 271(1)(c) were also analyzed, emphasizing the need for a specific notice without ambiguity. The burden of proof lies on the assessee to establish bona fide and due diligence. Due to the ambiguous notice, the penalty order was ruled in favor of the assessee.