Case Law Details
ACIT Vs Adidas India Marketing Pvt. Ltd. (ITAT Delhi)
ITAT Delhi held that the main purpose of incurring of huge AMP expenses has largely benefited assessee in India, with an incidental benefit arising to foreign AE. Hence, it is very difficult to accept existence of an international transaction.
Facts-
An order u/s 92 CA (3) of the Act has been passed on 31/03/2009 by the TPO by proposing adjustment of an amount of Rs. 23,90,62,090/-. The assessment order came to be passed on 25/03/2013 u/s 143(3) (ii) read with Section/144C of the Act by making an addition of Rs. 20,73,93,115/- on account of AMP expenses a sum of Rs. 3,16,68,935/- on account of mark up on AMP Expenses, a sum of Rs. 22,55,220/- on account of advance to holding company and a sum of Rs. 5,40,886/- on account of depreciation on computer peripheral.
CIT(A) allowed the Appeal filed by the assessee by rejecting TPO’s bright line approach in determining the Arm’s Length Price for the AMP expenditure incurred by the assessee and deleted disallowance of Rs. 8,12,57,204/-, wherein the Ld.CIT(A) followed the Assessee’s own case for Assessment Years 2006-07, 2011-12 & 2012-13 on the similar issues.
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