AVON BEAUTY PRODUCTS INDIA PVT. LTD.,GURGAON vs. ACIT, NEW DELHI

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ITA 5739/DEL/2011Status: DisposedITAT Delhi13 November 2015AY 2007-089 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the TPO's authority is limited to determining the ALP of international transactions, while the AO is responsible for deciding the deductibility of such expenses. The authorities below acted contrary to this principle.

What were the facts?

The assessee, a subsidiary of a foreign company, availed professional services from its foreign AE. The Transfer Pricing Officer (TPO) determined the Arm's Length Price (ALP) of these services at Nil, considering them as incidental or duplicate. The Assessing Officer (AO) made an addition based on the TPO's report.

What were the issues?

Whether the TPO can determine the existence and benefit of intra-group services, or if this falls within the AO's domain. The correct procedure for transfer pricing adjustment of intra-group services.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144C,Section 37(1)

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Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, DELHI BENCHES : I-2 : NEW DELHI

Before: SHRI R.S. SYAL, AM & MS SUCHITRA KAMBLE, JM

For Appellant: Shri Nageswar Rao &, Shri Shailesh Kumar, Advocates
For Respondent: Shri Anand Kumar Kedia, CIT, DR
Hearing: 12.11.2015Pronounced: 13.11.2015

per this judgment.

9.

In the result, the appeal is allowed for statistical purposes.

The order pronounced in the open court on 13.11.2015.

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