Louis Vuitton India Retail Private Limited Vs DCIT (ITAT Delhi)
ITAT Delhi held that Bright Line Test doesn’t have statutory mandate and cannot be applied for determining Arm’s Length Price [ALP] of Advertisement, Marketing and Promotion [AMP] expense. Accordingly, appeal allowed to that extent.
Facts- The case of the assessee was selected for scrutiny assessment and reference was made to TPO in respect of international transaction. TPO vide order u/s 92CA(3) of the Act dated 31/07/2023, proposed cumulative TP adjustment of Rs. 4,34,45,060/-. Further draft assessment order u/s 144C (1) of the Act came to be passed on 21/09/2023 determining the taxable income at Rs. 43,75,27,320/- and forwarded to the Assessee.
The Assessee filed its objection against the draft assessment order passed u/s 144C of the Act before the Dispute Resolution Panel. After considering the objection of the Assessee, the DRP vide order dated 30/06/2024 issued directions u/s 144C(5) of the Act. In compliance with the directions of the DRP, a final assessment order came to be passed on 23/07/2024 u/s 143(3) r.w. Section 144C(13)r.w. Section 144B of the Act by making TP adjustment of Rs. 4,34,45,060/-. Aggrieved by the final assessment order dated 23/07/2024, the Assessee preferred the present Appeal.
