Penalty can’t be deleted on transaction treated as sham

Whether the ITAT was correct in law in deleting the penalty ignoring the material fact that the transaction was treated as sham by ITAT as well as by this court (227 ITR 536) in the quantum proceedings?” If we take the view that a claim which is wholly untenable in law and has absolutely no foundation on which it could be made, the assessee would not be liable to imposition of penalty, even if he was not acting bonafide while making a claim of this nature, that would give a licence to unscrupulous assessees to make wholly untenable and unsustainable claims without there being any basis for m...