2019 (7) TMI 13

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....) for the assessment year 2012-13. 2. Brief facts are, the assessee, an Indian company, is engaged in the business of manufacturing and sale of polished diamond as well as diamond studded jewellery. For the assessment year under dispute, the assessee filed its return of income on 28th November 2012, declaring total income of Rs. 35,20,79,030. In the course of proceedings under section 92CA of the Act, the Transfer Pricing Officer called upon the assessee to furnish various information, documents/details to demonstrate that the international transaction entered with overseas Associated Enterprises (AEs) are at arm's length. In response to the query raised by the Assessing Officer, assessee furnished various details called for along wi....

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....Rs. 16,10,56,290. While deciding assessee's appeal challenging the imposition of penalty as aforesaid, learned Commissioner (Appeals) being satisfied with the submissions of the assessee deleted the penalty. 3. Learned Departmental Representative strongly relying upon the reasoning of the Transfer Pricing Officer as contained in the penalty order submitted, as per section 92D r/w rule 10D(1), the assessee is required to maintain information/documents which the Transfer Pricing Officer may require for enabling him to determine the arm's length price of the international transaction. He submitted, though, the assessee applied TNMM as the most appropriate method to benchmark the international transaction, however, he has not made proper....

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....Act cannot be imposed. More so, when the Transfer Pricing Officer has ultimately accepted the arm's length price of the international transaction shown by the assessee. In support of his contention, learned Authorised Representative relied upon the following decisions:- i) Dilipkumar V. Lakhi, IT(TP)A no.2142/Mum./ 2017, dated 02.08.2018; ii) Kiran Gems Pvt. Ltd., ITA no.5626/Mum./2016, dated 01.11.2018; iii) CIT v/s D. Navinchandra Exports P. Ltd., ITA no.6304/M./2016, etc. dated. 25.10.2017 5. We have considered rival submissions and perused material on record. We have also applied our mind to the decisions relied upon. On a careful reading of the penalty order passed under section 271G of the Act, it is ....

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....ng TNMM which was accepted by the Revenue. It is relevant to observe, the Transfer Pricing Officer has ultimately accepted the benchmarking done by the assessee under TNMM method. On going through the provisions of section 92D and rule 10D, we find that the assessee is required to maintain certain information/documents which may be required by the Transfer Pricing Officer for determining arm's length price. In the present case, 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. Further, the assessee has also explaine....