TaxTMI 
TaxTMI 
2024 (8) TMI 1759
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....g in mind the disclosures made, the delay of 811 days in refilling the appeal is condoned. Application stands disposed of. ITA 455/2024 1. The Principal Commissioner impugns the order of the Income Tax Appellate Tribunal [Tribunal] dated 07 January 2020 and posits the following questions of law for our consideration: "Issue 1 A. Whether, the facts and circumstances of the case and in law, the Hon'ble ITAT was justified in its decision in holding that AMP expenditure incurred during the year by the assessee does not constitute an 'International Transaction? B. Whether, the facts and circumstances of the case and in law, the Hon'ble ITAT was justified in holding that the "Brightline Test" was no....
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....en the issue of AMP is still sub-judice and is pending before the Hon'ble Apex Court? Issue 2 F. Whether, on the facts and circumstances of the case and in law, the Hon'ble ITAT was justified in considering that adjustment only on the basis of the outstanding receivables would have distorted the picture and re-characterize the transaction? G. Whether on the facts and circumstances of the case and in law, the Hon'ble ITAT was justified in holding that no adjustment for interest on outstanding receivables is warranted as working capital adjustment account for the impact on profitability and altogether ignoring the Arm's Length analysis conducted by the TPO? Issue 3 H. Whether on the facts and c....
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....ransaction u/s 92B of the Act and they ought to be examined in aggregation with the main transaction of export to AEs and after sales support income which have already been accepted to be at arm's length. Reliance placed on Hon'ble ITAT's judgment in the case of Patni Computer System Ltd. in ITA Nos. 426 & 1131/PN/2006. The Id. AR relied on the judgment of Indo-American Jewellery in ITA No. 1052 of 2012 and argued that no addition on account of interest is warranted. We hold that the findings of this case cannot be applied to the instant case as in the case of Indo-American Jewellery, the CIT(A) given relief holding that the profit of one AE is negligible while the other AE has incurred losses and therefore, it cannot be said th....
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....h a benefit, service or facility provided or to be provided to any one or more of such enterprises is an international transaction. In this case, admittedly, the taxpayer has provided benefit to its AE by way of advancement of interest free loan in the garb of delay receipt of receivables. These funds could have been otherwise deployed for at least earning interest income. The taxpayer has therefore incurred cost in connection with a benefit and services provided to the AE by way of delay receipt of receivables. Accordingly, even otherwise the delay in receipt of receivables is an international transaction u/s 92B(1) read with clause (v) of section 92F. The DRP held that the TPO charged interest on receivables beyond 30 days. The assessee m....
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.... full price upfront would want a discount to account for the prompt payment that is made. The necessity and desirability of an adjustment for the same is advocated by the OECD and the UN guidelines on Transfer Pricing as well. What is required to be done is to examine, by going through entire transaction between the AE and the non-AE parties regarding the payment pattern and to arrive at a decision as to whether there is any overt or covert scheme to transfer the profits by the way of delaying the payments to the assessee by the AE and thus getting benefited. This pattern unless established by the revenue, no adjustment on outstanding receivables can be made. Hence, the decision of the TPO of determining the 30 days as the credit period for....