TaxTMI 
TaxTMI 
2024 (12) TMI 1776
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....ds: 1. Whether, on the facts and circumstances of the case and as per law, the Ld. CIT(A) is justified in deleting the penalty of Rs. 6,63,82,699/- levied u/s 271G of the I.T. Act, 1961 when the statutory requirement of Rule 10B(1)(e), stating the methodology for benchmarking transactions using TNMM, states that the net profit margin from the controlled international transaction and the uncontrolled international transactions should be separately provided by the assessee, has not been fulfilled by the assessee? 2 2. Whether the deletion of penalty u/s 271G of the Act can be sustained without considering the fact that it is a statutory requirement to maintain the details as contemplated under Rule 10D (1)(d), Rule 10D (1)(g....
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.... in the case of the assessee for A. Y. 2015-16, which was rendered by Hon'ble ITAT relying on the judgment in the case of Navin Chandra Exports Put. Ltd. (ITA No. 6304/Mum/2016), which has been rendered on facts distinguishable from the case of the assessee? 2. Briefly stated, facts of the case are that the assessee during relevant time was engaged in the business of import of rough diamond and export of polished diamonds. During the relevant assessment year, the assessee carried out international transaction of export and import of cut and polished diamonds with its associated enterprises (AEs). During scrutiny assessment of the return of income, the Assessing Officer referred the determination of arm's length price of the inter....
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.... and directed to pass a fresh order for following reasons : (i) The order of the First Appellate Authority was not a speaking order, (ii) The Ld. CIT(A) failed to deal the decision of the Hon'ble Bombay High Court in the case of Shatrunjay Diamonds (261 ITR 258). 2.1 In compliance to the direction of the Tribunal, the Ld. CIT(A) passed impugned order on 22.08.204, wherein he deleted the penalty levied by the TPO. The Ld. CIT(A) followed the decision of the Tribunal in the case of assessee for assessment year 2015-16 in ITA No. 6713/Mum/2019 dated 14.06.2022. 3. Aggrieved with the finding of the Ld. CIT(A), the Revenue has preferred appeal raising the grounds as reproduced above. 4. The assessee has filed a Pap....
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....lowing the decision of the Tribunal (supra). 5.1 As far as, the contention of the Ld. DR that the Ld. CIT(A) has not followed the decision of the Hon'ble Bombay High Court in the case of Shatrunjay Diamonds (supra) is concerned, we find that decision of the Hon'ble Bombay High Court in the case of Shatrunjay Diamonds (supra) is in context of discharge of statutory obligation cast upon the assessee with relation to section 40A(2) of the Act. The Hon'ble High Court(supra) held that in relation to fair market value u/s 40A(2)(b) of the Act burden to prove shifts to the assessee and it is for the assessee to prove and discharge its burden by leading proper evidences. The relevant finding of the Hon'ble High court is reproduce....
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....tion by the Department. This is particularly important because the transaction is not at arms length. In the circumstances, we have reframed the question as follows : "Whether in the facts and circumstances of the case, the assessee who had imported the rough diamonds from a concern falling under Section 40A(2)(b) of the I.T. Act, had discharged its burden by adducing cogent evidence and establish that the price of rough diamonds paid by it to M/ s. Paras Gems was not excessive or unreasonable ?" 12. Since all authorities below have not gone into this aspect of the matter, we think it necessary, in the interest of justice, to set aside all the orders passed by the authorities below and remit the matter back to the A.O., to....