2015 (1) TMI 432

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....tion 260A of the Income Tax Act, 1961 (Act, for short) impugns order dated 31st August, 2012 passed by the Income Tax Appellate Tribunal (Tribunal, for short) affirming the finding of the Commissioner of Income Tax (Appeals) that the Assessing Officer was not justified in imposing penalty of Rs. 1,31,82,960/- under Section 271G of the Act. 2. The finding of the two appellate forums is that the assessee had filed the relevant documents within two months from the date of issue of notice by the Transfer Pricing Officer. The said notice issued by the Transfer Pricing Officer is dated 19th March, 2007. The respondent-assessee thereafter had filed an application seeking adjournment on 11th April, 2007 and the proceedings were adjourned for 8th M....

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....e said reply had raised a query to the office of the Transfer Pricing Officer and the penalty order records and accepts that adjournment was allowed and granted upto 18th May, 2007. The Assessing Officer referring to the Transfer Pricing Officer's response, observed that the Transfer Pricing Officer had not mentioned whether the assessee had filed Rule 10D documentation within the stipulated time. The Assessing Officer nevertheless and still observed that the assessee's letter dated 16th May, 2007 addressed to the Transfer Pricing Officer, which was filed before him, had not been corroborated by the Transfer Pricing Officer. Silence on the part of the Transfer Pricing Officer was read in negative and against the assessee. The assumption dra....

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....s supplied) 4. It is interesting to note that the Transfer Pricing Officer did not interfere and make adjustment to the international transactions. The total value of the international transactions was Rs. 65,91,48,060/-. This figure was not disturbed. It can be inferred that as per documentation filed, no addition was required. In spite of the Assessing Officer not being factually sure and certain, whether or not there was violation of Section 92D of the Act read with Rule 10D of the Rules, penalty @ 2% of the value of international transactions of Rs. 1,31,82,960/- was imposed. Penalty cannot be imposed unless and until the Assessing Officer is sure and certain that there was a violation. Ambiguity or doubt in the mind of the Assessing O....