TaxTMI 
TaxTMI 
2024 (5) TMI 218
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.... penalty order passed by the A.O under section 271(1)(c) of the I.T. Act, 1961 . 2. Revenue filed the following ground of appeal: "i. Whether on facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the penalty of Rs. 67,09,240/- u/s 271(1)(c) ignoring the fact that the Ld. CIT(A) has confirmed the addition on account of transfer pricing adjustment to the extent of Rs. 1,87,93,367/-. ii. The appellant craves leave, to add, alter or amend any ground of appeal raised above at the time of the hearing." 3. The brief facts of the case are that Gemalto Digital Security Private Limited (formerly known as Schlumberger Measurement and Systems India Limited and Axalto Cards & Terminals India Ltd.) wa....
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.... "Explanation 7- Where in the case of an assessee who has entered into an international transaction 64 for specified domestic transaction) defined in section 92B, any amount is added or disallowed in computing the total income under sub-section (4) of section 92C, then, the amount so added or disallowed shall, for the purposes of clause (c) of this sub-section, be deemed to represent the income in respect of which particulars have been concealed or inaccurate particulars have been furnished, unless the assessee proves to the satisfaction of the Assessing Officer or the Commissioner (Appeals) 65/or the Commissioner that the price charged or paid in such transaction was computed in accordance with the provisions contained in section 92C a....
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....l for the assessee has also relied upon the order of the Hon'ble Delhi High Court in the case of Pr. Commissioner of Income Tax (International Tax)-1 vs. Godaddy.com LLC learned CIT(A) (2020) 135 taxamann.com 130 (Delhi). He also relied on the following Tribunal orders which are as under: (i) Pr. CIT vs. Giesecks & Devrient (India) (P) (Ltd.) [2022] 135 taxmann.com 130 (Del)(HC) (ii) ACIT vs. AON Services India (P.) Ltd. 150 Taxmann.com 344 (Del ) (Trib) (iii) Chegg India (P) Ltd. vs. ACIT 126 taxmann.com 272 (Del-Trib) (iv) Johnson Matthey India (P) vs. DCIT 111 taxmann.com 77 (Del-Trib) 9. Hon'ble Delhi High Court in the case of Pr. CIT vs. Giesecks & Devrient (India) (P) (Ltd) [2022] 135 taxmann.com....
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....was justified in deleting the penalty imposed in respect of addition made on account of TP adjustment." 11. Similar view has been taken by the ITAT in the case of Chegg India (P) Ltd. vs. ACIT 126 taxmann.com 272 (Del-Trib) wherein the Tribunal has held that if AO did not apply his mind to satisfy as to which limb of section 271(1)(c) of the Act, penalty was being initiated then penalty levied by AO and confirmed by CIT(A) is not sustainable in eye of law and should be deleted. 12. Undisputedly, addition made by AO in the account of transfer pricing adjustment. The assessee has filed the appeal against the order and in appeal No.131/06-07/CIT(A)-XX has confirmed the addition on account of Arm's Length price to the extent of Rs. 1,87,9....