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| The Tax Publishers2020 TaxPub(DT) 4474 (Del-Trib) INCOME TAX ACT, 1961
Section 92B
Incurrence of AMP expenses by assessee, though alleged as excessive, could not in the absence of any 'agreement' or 'arrangement' or' understanding' between assessee and AE, be treated as international transactions for benefit of AE.
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Transfer pricing - International transactions - AMP expenses -
Assessee incurred Rs. 92 Crores towards advertisement and market promotion (AMP) expenditure.TPO treated AMP expenses as excessive and accordingly an international transaction for benefit of brand owned by AE abroad and accordingly TPO suggested TP adjustment.Held: TPO failed to establish existence of any 'agreement' or 'arrangement' or' understanding' between assessee and AE, whereby assessee was obliged to spend excessively on AMP in order to promote brand owned by AE. An 'assumed' price cannot form the reason for making an ALP adjustment under Chapter X and, therefore, AMP expenditure was not an international transaction.
Followed:Bausch & Lomb Eyecare (India) (P) Ltd. ITA No. 643/2014 Order, dated 23-12-2015 (Del-HC) : 2015 TaxPub(DT) 5476 (Del-HC).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2012-13
INCOME TAX ACT, 1961
Section 92C
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