TaxTMI 
TaxTMI 
TaxTMI 
2020 (2) TMI 509
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....ention to the order dated 18.10.2019, passed by the Division Bench of this Tribunal in assessee's own case in ITA No.621/Kol/2017 for the Assessment Year 2012-13 whereby the issue relating to compensation for advertising, marketing and promotion expenses (AMP Expenses) was discussed and adjudicated in favour of the assessee. Learned counsel for the assessee submitted that the present issue is squarely covered by the aforesaid order of the Tribunal, a copy of which was also placed before the Bench. 5. Learned Departmental Representative relied upon the orders of the authorities below. 6. We see no reasons to take any other view of the matter than the view so taken by the Division Bench of this Tribunal in assessee's own case vide order dated 18.10.2019. In this order, the Tribunal has inter alia observed as follows: "6. We have heard rival submissions and carefully gone through the material available on record. We also note that the issue in hand is squarely covered by the decision of this Tribunal, in assessee's own case in ITA No. 560/Kol/2016 & ITA No. 315/Kol/2016 wherein the Tribunal by order dated 28.08.2019 has held that that the AMP expenses cannot be regarded as an inte....
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....see MSIL is concerned since finding in Sony Ericsson to the above effect is in the context of those Assessees whose cases have been disposed of by that judgment and who did not dispute the existence of an international transaction regarding AMP expenses." In view of we note that the facts of the above case are identical to the present issue, thus the principle laid down by the Hon'ble Delhi High Court in the case of Maruti Suzuki India Limited (supra) are applicable to the instant case. Respectfully following the same we dismiss the ground of appeal filed by the Revenue. 6.2. The Kolkata 'C' Bench of the Tribunal in the case of Organon India Pvt. Ltd. vs. DCIT in ITA Nos. 633 & 2459/Kol/2017, order dt. 24/10/2018, applied the ratio of decision in the case of Philips India Ltd vs ACIT in ITA No. 2489/Kol/2017 dated 4.4.2018 for Asst Year 2013-14, and came to a conclusion that the AMP expenditure is not an international transaction. 6.3. The argument of the ld. D/R that on facts the assessee is a distributor, is not emanating from the records. The assessee is engaged in manufacturing and supply activities. Thus, the argument of the ld. D/R is rejected on facts. The fact....
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....pon the orders of the authorities below. 11 We see no reasons to take any other view of the matter than the view so taken by the Division Bench of this Tribunal in assessee's own case vide order dated 18.10.2019. In this order, the Tribunal has inter alia observed as follows: "10. Ground no. 4 of the appeal of the assessee is against the action of the AO in enhancing the income of the assessee by Rs. 69,963,072/- by determining arm's length price of intra-group services in respect of support services received from its AEs as nil. This issue has been considered by this Bench of the Tribunal in the earlier AY 2011-12 in assessee's own case in ITA No. 560/Kol/2016 & ITA No. 315/Kol/2016 vide order dated 28.08.2019 in which the Tribunal has observed as under: "9. Ground No. 5, is against the TP Adjustment made with regard to the International Transaction pertaining to "Intra Group Services". This issue has been considered by this Bench of the Tribunal in the earlier Assessment Years, in the assessee's own case in ITA No. 229 & 346/Kol/2015, Assessment Year 2010-11, order dt. 14/02/2018, wherein it has been held as follows:- "7. We have heard both the parties. We note that the TP....
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....essee relates to transfer pricing adjustment of Rs. 1,75,36,845/- towards contract research and development services rendered to the AE. 14 At the outset itself, the ld. Counsel for the assessee invited our attention to the order dated 18.10.2019, passed by the Division Bench of this Tribunal in assessee's own case in ITA No.621/Kol/2017 for the Assessment Year 2012-13 whereby the issue relating to transfer pricing adjustment towards contract research and development services rendered to the AE was discussed and the issue was remanded back to the file of TPO for fresh consideration, the contention of the assessee as well as ld. DR on this issue. Learned counsel for the assessee submitted that the present issue is squarely covered by the aforesaid order of the Tribunal, a copy of which was also placed before the Bench. 15 Learned Departmental Representative relied upon the orders of the authorities below. 16 We see no reasons to take any other view of the matter than the view so taken by the Division Bench of this Tribunal in assessee's own case vide order dated 18.10.2019. In this order, the Tribunal has inter alia observed as follows: "13. After hearing the rival submissions,....
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....Departmental Representative relied upon the orders of the authorities below. 21 We see no reasons to take any other view of the matter than the view so taken by the Division Bench of this Tribunal in assessee's own case vide order dated 18.10.2019. In this order, the Tribunal has inter alia observed as follows: "9. We have heard rival submissions and carefully gone through the material available on record. We note that in the facts and circumstances of the case of assessee, the R&D expenses incurred by it cannot be regarded as an international transaction as per section 92 B of the Act. We also note that the issue in hand is squarely covered by the decision of this Tribunal in assessee's own case in ITA No. 560/Kol/2016 & ITA No. 315/Kol/2016 wherein this Tribunal by order dated 28.08.2019 has held that the expenses in question covered under R&T Expenses relate to, service fee paid by the company for R&T Services obtained by the company, from another group company of the assessee i.e., ICT India Research & Technology Centre (ICI). ICT is a company registered u/s 25 of the Act as a "not for profit" organization. ICT provides manufacturing and training support services to the asse....
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....components for achieving the desired colour and texture of the paint to be manufactured. provided technical training on the manufacturing processes to the production team from time to time to ensure technical updation, improvement and refinement of the production team for the overall efficient execution of manufacturing operations of the Appellant. provided other technical support on day to day basis to the manufacturing operations and addressed the manufacturing process gaps. provided training to the marketing team on the product, the nature and feature of the products etc. necessary for sales and marketing of the Appellant's products in the designated market i.e. India. assisted the Quality department in handling product defect/ quality issue or redressing any product complaints from the customers. 8.2. A perusal of the above demonstrates that, on facts the assessee has not carried out any R&T activities. The expenditure in question is incurred only for its manufacturing operations and local environmental compliance from HSE perspective. The assessee submitted that ICT also does not carry out any research and development activities for development of any new project/t....
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....ore the Bench that Assessing Officer disallowed 10% of total advertisement and publicity expenses being Rs. 11.21 crore on estimate basis on the ground of absence of complete documentary evidences of the expenditure. The ld. Counsel submitted before us that the assessment order was framed u/s 143(3) of the Act therefore, the Assessing Officer cannot disallow the expenses on estimate basis. 26 On the other hand, the ld. DR on behalf of Revenue submitted that assessee during the course of assessment stage has not submitted the documents and evidences before the Assessing Officer to examine the veracity of the claim of the assessee for these expenses. Since the assessee failed to produce the relevant documents and evidence before the Assessing Officer therefore, the ld. DR for the Revenue prayed the Bench that this issue should be remitted back to the file of Assessing Officer for de novo adjudication. 27 We have heard both the parties and perused the materials available on record. We note that pursuant to remand report dated 24.08.2017, the ld. DRP held that these expenses cannot be considered as advertisement expenses. The ld. DRP also held that the above expenses should be disall....
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.... of the Act at Rs. 87,23,517/- considering all the investments held by the assessee. The AO held that expenditure under section 14A of the Act should be considered while computing book profit as per clause (f) under explanation [1] of section 115JB of the Act. The DRP considered the submission of the assessee and directed the AO to follow judicial decision of Hon'ble Delhi High Court in the case of Cheminvest Ltd. and restrict the disallowance under section 14A to Rs. 33,12,488/-. 30. We heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld. CIT(A) and other materials brought on record. We note that issue under consideration is no longer res integra. The Special Bench of ITAT in the case of Cheminvest Ltd. Vs CIT 121 ITD 318 (Delhi)(SB) held that the disallowance u/s 14A of the Act can be made even in the year where there is no exempt income earned or received by the assessee. The decision of the Special Bench on which the Ld. DRP placed reliance has since been reversed by the Hon'ble Delhi High Cour....