TaxTMI 
TaxTMI 
2024 (12) TMI 707
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....e Revenue has taken the following grounds of appeal:- "1. In the facts and on the circumstances of the case and in law, the ld.CIT(A) has erred in deleting the penalty u/s. 271AAA of Rs. 1,20,78,927/- levied for non-maintaining documents as specified in section 92D r.w.r. 10D, without discussing the case on merits." 3. The brief facts of the case are that the assessee is in the ship-breaking business, and a search operation was conducted on Priya Blue Group under section 132 of the Act on November 19, 2019, which also covered the premises of the assessee. Thereafter, notices under sections 153A and 148 of the Act. were issued, and the assessment was carried out by the Deputy Commissioner of Income Tax (DCIT). During the assessme....
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....as duly supported in the Tax Audit Report submitted by the assessee, which gave details of the purchases made by the assessee from related parties under section 40A(2)(b) of the Act. The assessee further submitted that if it had failed to maintain the necessary documents for determining the arm's length price as required under section 92D, the TPO should have made adjustments to the transfer pricing, computation which was not done in this case. It was pointed out that penalties can only be levied under section 271AA if the assessee fails to maintain the documents required by section 92D of the Act. Furthermore, the AO should have provided specific reasons for imposing such a penalty, particularly giving specific details of which documen....
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....BA for failure to submit the transfer pricing report, supporting the assessee's claim that there were no international transactions in those years. Accordingly, in light these facts, Ld. CIT(A) held that the penalty under section 271AA had been imposed without proper grounds, as no material evidence was presented to show which documents were missing or not submitted. The TPO had already confirmed that all the relevant details regarding vessel purchases had been provided by the assessee, and no adjustments were made to the arm's length price of the transactions. Given these facts, Ld. CIT(A) held that there was no justification for the levy of penalty under section 271AA of the Act, and therefore, the penalty imposed by the AO was delete....
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.... under section 271AA cannot be levied. Reliance was placed on several judicial decisions to support this view, including the case of DCIT v. Indian Taxmann.com (Chennai), Additives Express Highway (2017), ACIT v. Smith & Nephew Healthcare Pvt. Ltd. (2011), and DCIT v. Bebo Technologies Pvt. Ltd. (2014). Further, the counsel for the assessee submitted that the AO's order initiating the penalty proceedings is vague, scanty, and non-specific. The AO did not point out any specific document that the assessee allegedly failed to maintain, despite the documents being prescribed under section 92D r.w.r. 10D. In the assessment order, the AO merely stated in Paragraph 6 that since the assessee failed to maintain the documents required under secti....
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....ere vague and non-specific. 6. We have heard the rival contentions and perused the material on record. 7. On going through the order passed by Transfer Pricing Officer, we observe that no transfer pricing adjustment were made by the TPO. The primary contention of the counsel for the assessee before us is that during the impugned year under consideration, the penalty was initiated for non-maintenance of documents on an incorrect assumption of fact that the assessee had international transaction with an Associated Enterprise. However, while passing the order, Ld. CIT(A) has correctly taken note of the fact that the assessee did not have any international transactions, but had only transactions with a domestic associated enterprise. On p....