Fujifilm India Private Limited Vs Assessing Officer (ITAT Delhi)
The appeal arose from the assessment order dated 29.06.2024 passed under Sections 144, 144C(13), and 144B of the Income-tax Act, 1961, pursuant to the directions of the Dispute Resolution Panel (DRP) for Assessment Year 2020-21.
The assessee, a part of the Fujifilm Group, is engaged in trading medical products, imaging products, digital cameras, graphic printing solutions, data storage solutions, and industrial products in India. It purchases products from its associated enterprises (AEs) for resale in India. The assessee filed its return declaring income of ₹51,29,52,500 and furnished Form 3CEB reporting its international transactions.
The case was selected for scrutiny. Since the assessee had entered into international transactions with its AEs, the Assessing Officer referred the matter to the Transfer Pricing Officer (TPO) under Section 92CA(1) for determination of the arm’s length price (ALP).
The TPO observed that the assessee had incurred Advertising, Marketing and Promotion (AMP) expenditure which, according to the TPO, promoted the “Fuji” brand owned by the parent AE and therefore constituted an international transaction that had not been reported in Form 3CEB. The TPO held that the parent AE benefited through brand building and should have compensated the assessee for such expenditure.
