TaxTMI 
TaxTMI 
2014 (3) TMI 254
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....overed by the earlier decisions of the Tribunal, the Revenue has nothing to say. 5. Let us now consider each ground of appeal. Ground No. 1 is of general in nature and needs no separate adjudication. 6. Ground No. 2 relates to the disallowance of tax on Brand Usage Royalty of Rs. 182.34 lakhs. 6.1. This issue finds place at page-7 on para-1 of DRP's order. The DRP has uphold the adjustment made by the AO holding that this issue is coming from earlier year. We find that the Tribunal in assessee's own case for A.Y. 2002-03 in ITA No. 4092/M/07 at para-34 on page-13 of its order has deleted the adjustment made by the AO and the same view was taken by the Tribunal in A.Y. 2006-07 in ITA No. 83/M/2011. As no distinguishing facts have been brought before us, respectfully following the findings of the Tribunal in assessee's own case, addition of Rs. 182.34 lakhs is deleted. Ground No. 2 is accordingly allowed. 7. Ground No. 3 relates to the disallowance of service tax amounting to Rs. 150.25 lakhs. 8. This issue has been discussed by the DRP at page-7 on para-2 of its order wherein the DRP has confirmed the action of the AO noting that this issue is coming from earlier year. We find ....
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....n A.Y. 2002-03 in ITA No. 4092/M/07 has considered a similar grievance at para-42 of its order and deleted the addition on this account. A similar view was followed by the Tribunal in A.Y. 2006-07 in ITA No. 83/M/2011 at para-35 of its order. Respectfully following the findings of the Tribunal in assessee's own case (supra), the addition of Rs. 678.78 lakhs is deleted. Ground No. 7 is accordingly allowed. 15. Ground Nos. 8 to 10 relate to the disallowance of service tax paid on know-how royalty. 16. These grievances of the assessee was considered by the DRP at page-8 vide Objection No. 6 wherein the DRP has mentioned that this issue is coming from earlier year for A.Y. 2006-07. The DRP has uphold the adjustment made by the TPO on same ground. We have the benefit of the order of the Tribunal for A.Y. 2006-06 in ITA No. 83/M/2011. A perusal of para-34 on page 27 of the said order shows that the Tribunal has followed the decision of the Co-ordinate Bench in assessee's own case for A.Y. 2002-03. Respectfully following the orders of the Tribunal, we hold that the disallowance made by TPO on account of cess service tax is not justified. We, accordingly delete the same. Ground No. 8 to ....
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....ng AMP expenditure of Rs. 130.18 crores in this segment computed the excess AMP expenditure at Rs. 81.23 crores and applying a mark-up of 10% determined an adjustment of Rs. 89.36 crores for the manufacturing segment. For the distribution segment, the TPO took 0.4% for the bright line adjustment and applied the net sales of Rs. 188.59 crores for the distribution segment and further considering the AMP expenditure of Rs. 40.12 crores, the TPO determined the excess AMP expenditure at Rs. 32.43 crores and applying the mark up of 10% determined an adjustment of Rs. 35.67 crores for the distribution segment. 20. The assessee strongly objected this before the DRP stating that AMP expenses incurred represents only domestic transactions undertaken with third parties and are outside the purview of Section 92B of the Act. The assessee also strongly objected to the application of profit split method. It was the contention of the assessee that the Profit Split Method (PSM) based on the consolidated net profit of the entire Johnson & Johnson group world-wide is erroneous and instead the aggregate profits generated by J&J India and its AEs on manufacturing and trading of sample products sold in....
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....ieved by this, the assessee is before us. The Ld. Counsel for the assessee reiterated that AMP expenditure is not an international transaction. It is the say of the Ld. Counsel that Johnson & Johnson brand has been in existence even before the assessee started its operations in India, therefore, the assessee did not need to create Johnson & Johnson brand in India. The assessee only informed the customers about its product launch and its feature of its product. The Ld. Counsel explained the purpose/objections of incurring AMP expenditure. It is the say of the Ld. Counsel that a company considers the following specific factors: a) Stage in the product life cycle b) Market share and consumer base c) Facing competition d) Informing the changes to the customers e) Barring new entrants. 24. The Ld. Counsel continued to argue that Johnson & Johnson India is the sole beneficiary of the entire AMP expenditure incurred by the Johnson & Johnson India. It is the say of the Ld. Counsel that J&J US the ultimate parent company of J&J group itself spend huge amount of brand building activities. In alternative, the Ld. Counsel submitted that even if the AMP spent by J&J India needs to be comp....
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.... orders in assessee's own case at para 4.2 on page 3 of its order and at para 4.3 held that the expenditure on production of advertisement films is revenue in nature. Respectfully following the orders of the Tribunal (supra), we hold that the expenditure on production of advertisement films is revenue in nature and accordingly direct the AO to delete the same. Ground No. 24 & 25 are accordingly allowed. 30. Ground No. 26 relates to the adjustments made u/s. 145A of the Act to the tune of Rs. 229.18 lakhs. 31. This grievance of the assessee was considered by the DRP vide Objection No. 9 on page 17 of his order wherein the DRP has followed his own findings for A.Y. 2006-07. An identical issue was considered by the Tribunal in assessee's own case in A.Y. 1999-2000 and 2000-01, 2001-02, 2001-02, 2002-03 and 2006-07 in ITA Nos. 2680/M/03, 3289/M/04, 9347/M/10, 4092/M/07 and 83/M/2011. We find that the Tribunal in A.Y. 2006-07 has considered this issue at para-5 on page-4 of its order and at para-5.2 followed the findings of the Co-ordinate Bench for earlier assessment years and at para 5.3 restored this issue to the files of the AO with a direction to decide the same afresh. Respectfu....