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Tax Publishers
Levy of concealment penalty post facto MAP
proceedings
Facts :
Assessee a US entity supplied spares, rotary joints and did
hardware support to Airport Authority of India wherein it was alleged that they
created a Permanent Establishment (PE) and payments emanating from India were
held to be royalty taxable in India. The said case of the assessee was referred
to Mutual Agreement Procedure (MAP) as per Article 27 of the Indo-US DTAA and
the case got concluded in the MAP proceedings amicably between both country tax
authorities. Bereft of this, MAP proceedings revenue alleged that there was
concealment of income by the assessee and sought to levy penalty under section
271(1)(c). Assessee's plea was that there was no concealment in the first
place, secondly as the case has been decided under MAP no penalty was
thereafter not sustainable as the grounds of levy of penalty by revenue was
also not applicable on facts. CIT(A) went with the assessee. On higher appeal
by revenue -
Held in favour of the assessee that no penalty was
sustainable in their case post facto MAP proceedings as there was no
concealment by them in the first place.
Case : DCIT v.
Raytheon Co. & Anr. 2023 TaxPub(DT) 5268 (Del-Trib)
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