TaxTMI 
TaxTMI 
2018 (2) TMI 865
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....me Tax [Ld.CIT(A)] erred in confirming the penalty levied under section 271(1)(c) of the Act by the Ld. AO on account of Transfer pricing adjustment u/s 92CA(3) of the Act in the impugned penalty order passed on March 31, 2014 by the Dy. Commissioner of Income Tax , Circle 13(1), New Delhi ("Ld. AO"). 1.1 That on the facts and in the circumstances of the case and in law, the CIT(A) erred in confirming the action of Ld. AO in levying the penalty under section 271(1)(c) of the Act on the purported ground that the appellant had concealed particulars of its income as also furnished inaccurate particulars of income in respect of transfer pricing adjustment u/s 92CA(3) of the Act amounting to Rs. 94,16,785/-. 1.2 That on the fac....
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....gnoring ration decidendi as laid down by Hon'ble Delhi High Court in the case of C1T vs. Zoom Communication Pvt. Ltd. (327 ITR 510)? 4. That the order of the CIT(A) is erroneous and is not tenable on facts and in law. 5. That appellant craves leave to add, amend, alter or forgo any ground(s) of appeal either before or at the time of hearing of the appeal." 4. From the aforesaid grounds, it is gathered that the grievance of the assessee relates to the sustenance of the penalty while the department is in appeal against the deletion of penalty levied by the AO u/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as the Act). 5. Facts of the case in brief are that the assessee filed the return of income....
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....as per TP adjustment u/s 92CA(3) of the Act. The AO levied the penalty of Rs. 6,80,11,186/- u/s 271(1)(c) of the Act. 7. Being aggrieved the assessee carried the matter to the ld. CIT(A) who deleted the penalty in respect of the ESOP expenses amounting to Rs. 21.28 crores by observing that it was a debatable legal issue. The reliance was placed on the judgment of the Hon'ble Apex Court in the case of CIT Vs Reliance Petroproducts (P.) Ltd. 189 Taxman 322. The ld. CIT(A) also directed the AO to recompute the penalty on account of additions made as per TP adjustment u/s 92CA(3) of the Act. 8. Now both the parties are in appeal. The ld. Counsel for the assessee at the very outset stated that the additions on the basis of which the penalt....
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....rm the view taken by the ld. CIT(A) for deleting the penalty u/s 271(1)(c) of the Act levied by the AO on account of addition for ESOP expenses. 12. As regards to the addition on account of TP adjustments, the relevant findings have been given in para 10.9 of the aforesaid referred to order dated 17.08.2016 which read as under: "10.9 Thus we hold that: (a) There can be no mark-up on reimbursement of expenses incurred by the assessee prior to incorporation of NDTV Network Plc UK. (b) The action of the AO in charging a mark-up on reimbursement of expenses incurred by the assessee on management services after incorporation is upheld. Though the Ld. Counsel for the assessee raised arguments on percentage o....