https://www.taxtmi.com/caselaws?id=755629 The Delhi HC ruled in favor of the assessee in a transfer pricing dispute involving Samsung Telecommunications India (STI) and its Korean parent company. The TPO and DRP had characterized STI as a contract manufacturer, arguing it should not receive independent manufacturer remuneration for royalty payments to Samsung Korea. The HC rejected this characterization, finding STI operated independently without extensive instructions from Samsung Korea regarding production quantity, quality, or sales directives. The court held that STI manufactured goods per its own volition and made independent business decisions. The mere fact of being a wholly-owned subsidiary did not establish contract manufacturing status under OECD Guidelines. Samsung Korea retained the right to arms-length returns on its proprietary technology. The HC decided against revenue. en-us Thu, 11 Jul 2024 00:00:00 +0530 Wed, 23 Oct 2024 15:01:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=755629 The Delhi HC ruled in favor of the assessee in a transfer pricing dispute involving Samsung Telecommunications India (STI) and its Korean parent company. The TPO and DRP had characterized STI as a contract manufacturer, arguing it should not receive independent manufacturer remuneration for royalty payments to Samsung Korea. The HC rejected this characterization, finding STI operated independently without extensive instructions from Samsung Korea regarding production quantity, quality, or sales directives. The court held that STI manufactured goods per its own volition and made independent business decisions. The mere fact of being a wholly-owned subsidiary did not establish contract manufacturing status under OECD Guidelines. Samsung Korea retained the right to arms-length returns on its proprietary technology. The HC decided against revenue. Case-Laws Income Tax Thu, 11 Jul 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=755629