Tax Authority's Protective Adjustment Challenge Fails: ITAT Order Upheld Under Established Precedent for Sony Ericson Principle

HC dismissed Revenue's appeal against ITAT order for AY 2014-15, following precedent in Sony Ericson case. The court rejected the Assessing Officer's "bright line test method" for protective adjustments, upholding the earlier tribunal decision and maintaining consistency in tax assessment approach.

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In the case before the Delhi High Court, the Revenue appealed against the order dated 24.01.2019 by the Income Tax Appellate Tribunal (ITAT) concerning the assessment year 2014-15. The ITAT's decision was based on the precedent set by the Delhi High Court in "CIT Vs. Sony Ericson Mobile Communication India Pvt. Ltd., [2015] 55 taxmann.com 240," where the Court rejected the "bright line test method" used by the Assessing Officer for protective adjustments. The High Court, comprising HON'BLE MR. JUSTICE VIPIN SANGHI and HON'BLE MR. JUSTICE SANJEEV NARULA, upheld the ITAT's decision, dismissing the appeal, as the issue had already been adjudicated in the Sony Ericson case.

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