M/S TELSIMA COMMUNICATION PRIVATE LIMITED,BANGALORE vs. DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-7(1)(1), BANGALORE

O R D E R PER SHRI PAVAN KUMAR GADALE, JM :

The assessee has filed an appeal against the order of learned Commissioner of Income Tax (Appeals)-7, Bangalore passed under Section 271G and 250 of the Income Tax Act, 1961. 2. The assessee has raised the following grounds of appeal :

3. The Brief facts of the case are that the assessee company is engaged in manufacturing of telecommunication products and provide services and solutions and has Hardware and Software Business Segment. In the assessment proceedings, reference was made to the Transfer Pricing Officer (TPO) by the ACIT, Circle 12(4), Bangalore and whereas TP Study was conducted by the TPO and passed the order under Section 92CA of the Act on 27.01.2016. Further, the TPO has issued Notice Dt.30.11.2015 to submit the International Transactions entered by the assessee with its Associated Enterprises (AE). After due correspondence with the assessee, the TPO has issued show cause notice initiating penalty proceedings for non- furnishing of information on hardware and software segments. The assessee filed submissions in the penalty proceedings by letter dt.29.02.2016 explaining that the penalty under Section 271G of the Act apply if the conditions prescribed under Section 92D(iii) are not complied whereas the assessee has maintained all required documents under Rule 10D of the I.T. Rules and whereas the Assessing Officer was not satisfied with the assessee's submissions and observed that the assessee has not maintained proper information on transactions and leveled penalty 2% on International Transactions which worked out to Rs.7,03,669 and passed the order under Section 271G of the Act Dt.28.07.2016. Aggrieved by the order, the assessee filed an appeal with the CIT(Appeals). Whereas the CIT(Appeals) has confirmed the action of the Assessing Officer and dismissed the assessee's appeal. Aggrieved by the CIT (Appeals) order, the assessee has filed an appeal with Tribunal.

4. At the time of hearing, the ld. AR submitted that the assessee has maintained details under the provisions of the Act in Transfer Pricing Study and filed explanations in the penalty proceedings whereas the Assessing Officer has levied a penalty as some details required to be maintained under Rule 10D which the assessee has complied and prayed for allowing the assessee's appeal. Contra, the learned Departmental Representative supported the orders of the CIT(Appeals).