TaxTMI 
TaxTMI 
2017 (6) TMI 873
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....-07, 2007-08 & 2008-09. Date of Hearing 12.04.2017 Date of Pronouncement 17.04.2017 ita 2. During the course of hearing the Ld. AR submitted that the Hon'ble Delhi High Court vide order dated 27th July 2016 has remanded the issue regarding the existence of international transaction involving AMP expenses between the assessee and its AE to the ITAT. The Ld. AR further submits that as per the instructions from the assessee/client he is requesting for remand of this issue before the TPO/A.O for determining the existence of international transactions involving AMP expenses. He further submitted that selling expenses should not be considered within the ambit of AMP. For Assessment Year 2007-08 & 2008-09, the Ld. AR submitted that on the l....
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....ee TNMM 91,35,000 5 Payment of royalty TNMM 25,98,620 6 Reimbursement of warrants - 1,62,30,708 7 Reimbursement of commission TNMM 2,35,004 8 Payment of seminar expenses TNMM 2,32,920 9 Reimbursement of freight charges - 8,81,893 10 Other recoverable TNMM 2,97,946 11 Cost reimbursement TNMM 83,87,418 12 Consultancy services TNMM 48,51,450 4.2. The transaction pertaining to import of finished goods for distribution was accepted at arm's length based on the following comparability analysis: S No Company Name Weighted Average GP/Sales (%) 1. ACI Infocom Limited 0.12 2. Business Link Automation (India) Limited 1.59....
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....eal before the Hon'ble Delhi HC. The HC vide order dated July 27, 2016 held that the ITAT has not rendered any categorical finding on the central issue of existence of international transaction between Assessee and its AE involving AMP expenses. Accordingly, the HC remanded the matter back to the file of the ITAT, to first decide the question regarding the existence of international transaction with the direction that the Tribunal shall not remand the matter to lower authorities for decision. ita 4.6. Exclusion of direct selling expenses from AMP expenditure for the purpose of determination of ALP, as per the directions of the Delhi HC in Sony Ericsson 374 ITR 118 Particulars Amount (INR) Sales Commission (Refer pg 281 vol 1 of ....
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.... 6. Priya Limited 1.43 7. Iris Computers Limited 1.26 8. Control Print (India) Limited 15.87 9. Usha International Limited 3.67 10. SES Technologies Limited 0.74 Mean (%) 5.43 4.9 However, the TPO observed that the Assessee had incurred excessive AMP Expenditure by applying the 'Bright Line Test' wherein he selected 7 out of the 10 comparable companies selected by the Assessee Company name AMP/ Sales - as per TPO Order (%) ACI Infocom limited 0.44% Business Link Automation (India) Limited 1.51% Compuage Infocom India Limited 0.00% Kilburn Office Automation Limited 1.07% Priya Limited 0.08% Iris Computers Limited 0.56% Control Print (....
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....O Import of air conditioners and spare parts TNMM OP/OR 98,37,35,533 TPO/ AO accepted the arm's length price of the transaction Management and technical training services TNMM OP/OR 13,90,100 Receipt of consultancy services TNMM OP/OR 89,02,817 Import of fixed assets TNMM OP/OR 29,03,096 Market support and maintenance services TNMM OP/OC 9,29,91,747 Reimbursement of expenses NA 1,68,00,247 Recovery of expenses NA 2,39,33,406 4.13 The transaction pertaining to import of finished goods for distribution was accepted at arm's length based on the following comparability analysis: S No Company Name Weighted Average (%) OP/OR 1. Bajaj Electricals Limited 9 08 ....
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....B )(Refer page No. 270 of PB) 9,73,58,499 178,377,015 Less: Sales Commission (97,358,499) Less: Selling and dealer incentives (33,802,245) Total AMP to be considered by applying HC principles 47,216,271 5. We have heard both the sides and perused all the records. As per the Hon'ble Delhi High Court's direction given in an appeal by the assessee, while remanding back the matters before the ITAT, the Hon'ble High Court in Para 12 (b) directed ITAT to itself decide the question regarding the existence of an international transaction involving AMP Expenses between the assessee and its AE. The Ld. AR fairly, at the outset, accepting that the decision on the question of AMP as an international tr....