Lack of good faith and due diligence cannot be inferred when the grounds on which ALP determined by the assessee has been rejected are reasonably debatable

DCIT Vs RBS Equities India Ltd. (ITAT Mumbai)- Rejection of most appropriate method selected by the assessee does not mean that assessee carried out transfer pricing study without good faith and due diligence and hence, penalty for concealment of income cannot be sustained. The Tribunal has held that the Explanation 1 to Section 271(1)(c) cannot be applied to the cases where the additions are made to the total income on account of transfer pricing adjustments. These cases should be subject to penalty under Explanation 7 to Section 271(1)(c) only if the assessee does not prove to the satisfact...