MOBITECH CREATIONS PRIVATE LIMITED,SOUTH EAST DELHI vs. DCIT, NEW DELHI

ITA 1005/DEL/2025Status: DisposedITAT Delhi21 August 2026AY 2021-202216 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the licensor was not a related party, and therefore, transfer pricing provisions were not applicable. The transaction was considered an independent third-party transaction, and the AO could not disallow the royalty payment under Section 37 based on excessiveness.

What were the facts?

The assessee debited royalty payments to a foreign company for the use of trademarks. The Assessing Officer (AO) treated this as an international transaction between associated enterprises, benchmarked it, and disallowed a portion as excessive. The CIT(A) upheld the AO's order.

What were the issues?

Whether the royalty payment to a foreign company constituted an international transaction between associated enterprises, and if the AO could disallow the expenditure as excessive under Section 37.

Which sections of the Income-tax Act were involved?

Section 92A,Section 92B,Section 92CA,Section 92C,Section 37(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘H’: NEW DELHI

Before: SHRI S.RIFAUR RAHMAN & SHRI VIMAL KUMAR

For Appellant: Shri Aseem Chawla, SR. Advocate, Shri Jasmeet Singh, Advocate, Shri Pranav Menon, Advocate, Ms. Pratishtha Chaudhary, Advocate
For Respondent: Shri Bhopal Singh, CIT DR
Hearing: 02.06.2026Pronounced: 21.08.2026

PER S.RIFAURRAHMAN,AM:

1.

This appeal filed by the assessee is directed against the order of ld. Commissioner of Income-tax (Appeals)-30, New Delhi [for short ‘ld. CIT (A)] dated 27.12.2024for the Assessment Year 2021-22. The assessee has filed grounds of appeal and also filed additional grounds of appeal before us, the additional grounds raised by the assessee are reproduced below:-

2 i. That on the facts and circumstances of the case and in law, the Ld. CIT(A) erred in sustaining the Assessment Order and has disregarded the fact that the App

The order continues below.

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