LG Electronics India Pvt. Ltd. v. ACIT

140 ITD 41Income Tax Appellate Tribunal2013#1007 most cited

What is LG Electronics India Pvt. Ltd. v. ACIT authority for?

The Assessing Officer or Transfer Pricing Officer can benchmark Advertisement, Marketing, and Promotion (AMP) expenses as an international transaction if it creates or is intended to create economic or commercial benefit for an associated enterprise. The 'bright line' method can be used for this purpose.

107

judgments rely on this decision, according to BharatTax’s citation analysis of 366,005 Indian tax judgments — from 2015 to 2026.

Also referred to as

LG Electronics India Pvt. Ltd. v. ACIT · 140 ITD 41 · AMP expenses · international transaction · section 92B · section 92F · bright line method · benchmarking · associated enterprise

Sections most often in play

Section 1938Section 143(3)Section 92BSection 92CA(1)Section 115BSection 143(2)Section 14ASection 1999

Issues it is cited on

bright line testamp expendituresection 92(1)comparable uncontrolled price methodcost plus methodsection 92ffunctional analysissection 92c(3)section 80jjasection 80jjaamanagement feesbenchmarking analysis

Judgments citing LG Electronics India Pvt. Ltd. v. ACIT

M/S the Oriental Inssurance Co.Ltd., New Delhi vs. DCIT, New Delhi

ITA 200/DEL/2016[2011-12]Status: DisposedITAT Delhi22 Nov 2022AY 2011-12

Bench: Shri Anil Chaturvedi & Shri Anubhav Sharmam/S. The Oriental Insurance Co. Ltd, Vs. The Dcit, A 25/27, Asaf Ali Road, Ltu, New Delhi New Delhi-110002 (Appellant) (Respondent) Pan: Aaact0627R

For Appellant: Shri Tarandeep Singh, AdvFor Respondent: Ms. Sarita Kumari, CIT DR
Section 10(38)Section 115Section 115JSection 143(1)Section 143(2)Section 143(3)Section 14ASection 28Section 44

…en by the assessee which relates to the claim of deduction by the assessee u/ 10 (34) in respect of dividend income, we noted that this issue is duly covered by decision of Mumbai Bench of this Tribunal in case of ICICI Prudential Insurance Company Ltd v ACIT 140 ITD 41 in which under para 47 while dealing with similar issue following decision of General Insurance Corp of India v CIT 204 Taxman.com 587 by Bombay HC gave clear cut finding that assessee is entitled to exemption u/s 10(34) for the dividend income. We also noted while disposing of ground relating to applicability of S. 14A for disallowance of expendi…

DCIT- Circle- 14 (1)(1), Mumbai vs. Kotak Mahindra Life Insurance Company Ltd., Mumbai

In the result all the three appeals of the Revenue are dismissed

ITA 1413/MUM/2022[2017-18]Status: DisposedITAT Mumbai28 Sept 2022AY 2017-18
Section 115BSection 143(3)Section 14A

…ts of the case, the stand taken by the AO in the assessment order and the contentions of the appellant. This issue is covered by the decisions of the Hon'ble Jurisdictional Mumbai Tribunal in the case of ICICI Prudential Insurance Co Ltd, v/s ACIT reported in 140 ITD 41. The issue has been discussed at length by the Hon'ble Tribunal and the relevant finding at para 59 of the said order is reproduced as under: 59. After considering the rival submissions and examining the method of accounting and the mandate given by regulations to appoint Actuarial on the concept of mathematical reserves, we do not see any reason…

DCIT, Circle-14(1)(1)., Mumbai vs. M/S Kotak Mahindra Life Insurance Company Ltd, Mumbai

In the result all the three appeals of the Revenue are dismissed

ITA 1353/MUM/2022[2016-2017]Status: DisposedITAT Mumbai28 Sept 2022AY 2016-2017
Section 115BSection 143(3)Section 14A

…ts of the case, the stand taken by the AO in the assessment order and the contentions of the appellant. This issue is covered by the decisions of the Hon'ble Jurisdictional Mumbai Tribunal in the case of ICICI Prudential Insurance Co Ltd, v/s ACIT reported in 140 ITD 41. The issue has been discussed at length by the Hon'ble Tribunal and the relevant finding at para 59 of the said order is reproduced as under: 59. After considering the rival submissions and examining the method of accounting and the mandate given by regulations to appoint Actuarial on the concept of mathematical reserves, we do not see any reason…

DCIT, Circle-14(1)(1)., Mumbai vs. M/S Kotak Mahindra Life Insurance Company Ltd, Mumbai

In the result all the three appeals of the Revenue are dismissed

ITA 1352/MUM/2022[2014-2015]Status: DisposedITAT Mumbai28 Sept 2022AY 2014-2015
Section 115BSection 143(3)Section 14A

…ts of the case, the stand taken by the AO in the assessment order and the contentions of the appellant. This issue is covered by the decisions of the Hon'ble Jurisdictional Mumbai Tribunal in the case of ICICI Prudential Insurance Co Ltd, v/s ACIT reported in 140 ITD 41. The issue has been discussed at length by the Hon'ble Tribunal and the relevant finding at para 59 of the said order is reproduced as under: 59. After considering the rival submissions and examining the method of accounting and the mandate given by regulations to appoint Actuarial on the concept of mathematical reserves, we do not see any reason…

Perfetti Van Melle India Pvt. Ltd., Gurgaon vs. ACIT, Circle-3(1), Gurgaon

In the result, the additional ground raised by the assessee is allowed

ITA 463/DEL/2021[2016-17]Status: DisposedITAT Delhi22 Sept 2021AY 2016-17

Bench: The Income Tax Appellate Tribunal, Delhi Bench “I-2”, New Delhi

For Appellant: Mr. Deepak Chopra, AdvFor Respondent: Ms. Meera Shrivastava, CIT (DR)
Section 142(1)Section 143(2)Section 143(3)Section 271(1)(c)Section 80Section 80ISection 92C

…e travelled before the Tribunal, the matter was remanded back to the file of the Assessing Officer for re-examination of the issue in the light of the ratio laid down by the Special Bench of ITAT in the case of LG electronics India Pvt. Ltd. vs. ACIT : [2013] 140 ITD 41. We are informed that the appeal for AY 2008-09 is currently pending adjudication before the CIT (A). The AMP dispute, in the other assessment years, has also suffered similar fate. The status of the AMP appeals of the assessee is being depicted with the help of the chart filed by the assessee before us:- S. AY Date of Outcome of AMP Present stat…

DCIT-15(2)(1), Mumbai vs. M/S Kellogg India Pvt Ltd., Mumbai

In the result, appeal of the Revenue is dismissed

ITA 4576/MUM/2019[2010-11]Status: DisposedITAT Mumbai23 Jul 2021AY 2010-11
Section 143(3)Section 92B

…d M/s. Dabur India Ltd., and M/s. Marico Ltd. as comparables for applying the Bright Line Test and determined the ALP of AMP expenditure by relying on Special Bench decision of Delhi Tribunal in the case of LG Electronics India Pvt. Ltd., vs. ACIT reported in 140 ITD 41. The arithmetic mean margin of these two comparables i.e. M/s. Dabur India Ltd., and Marico Ltd., arrived by the ld. TPO was 12.24%. The ld. TPO observed that the gross sales of the assessee in the manufacturing segment was Rs.272.03 Crores and AMP expenditure after excluding distribution expenses was Rs.53.51 Crores which amounted to 19.67% of ne…

Amadeus India Pvt. Ltd., New Delhi vs. ACIT, Circle 2(2), New Delhi

In the result, the appeal of assessee are allowed

ITA 8700/DEL/2019[2015-16]Status: DisposedITAT Delhi31 May 2021AY 2015-16

Bench: Sh. Anil Chaturvedi & Sh. Amit Shukla(Through Video Conferencing) Amadeus India Pvt. Ltd., Vs. Acit E-9, Connaught Hose, Circle – 2(2), Connaught Place, New Delhi New Delhi - 110001 Pan No. Aaaca 0364 L (Appellant) (Respondent) Assessee By Shri Taran Deep Singh, Adv. Revenue By Shri Surender Pal, Cit-D.R. Date Of Hearing: 18/05/2021 Date Of Pronouncement: 31/05/2021 Order Per Anil Chaturvedi, Am: This Appeal Filed By The Assessee Is Directed Against The Order Dated 19.09.2019 Of The Asst. Commissioner Of Income Tax, Circle-2(2), Delhi Under Section 143(3) R.W.S 144C(13) Of The Act Pursuant To The Direction Of Dispute Resolution Panel (Drp) – 1, Delhi For Assessment Year 2015-16. 2. The Relevant Facts As Culled From The Material On Records Are As Under :

Section 143(2)Section 143(3)Section 144CSection 144C(2)Section 144C(5)Section 92BSection 92CSection 92C(3)Section 92F

…not disturbed these objections but has upheld the case of the learned Transfer Pricing Officer on some other grounds, i.e., (i) by relying upon the Special Bench decision in the case of L. G. Electronics India (P.) Ltd. v. Asstt. CIT [2013] 29 taxmann.com 300/140 ITD 41 (Delhi - Trib.) [SB] ; (ii) by holding that since the appellant is a dependent agency permanent establishment of its associated enterprise hence all the expenses on advertisement, marketing and promotion are being incurred by it for the benefit of the associated enterprise, and (iii) by relying upon the amended provisions of section 92B. We do no…

ACIT Cir. 12(1)(2), Mumbai vs. Bharti Axa Life Insurance Company Ltd., Mumbai

In the result, the appeal of the revenue is dismissed and cross objection of the assessee is allowed

ITA 2930/MUM/2019[2007-08]Status: DisposedITAT Mumbai31 Mar 2021AY 2007-08
Section 143(3)Section 147Section 149Section 151

…application of mind on the existing records which is legally an invalid reason for reopening of assessment. 6.1.4. Reliance in this regard is placed on the decision of Mumbai Bench of Tribunal in the case of ICICI Prudential Insurance Co. Ltd. vs. ACIT [2012 140 ITD 41 (ICICI-2012') wherein it was held that surplus disclosed in Form-1 cannot form the basis of computation of taxable profits in the case of insurance company. The aforesaid decision was followed by Mumbai Bench of the Tribunal in the following cases: - HDFC Standard Life Insurance Company Ltd vs. DCIT (OSD)-l(l) (ITA No.2203 of 2012) (HDFC) - ICICI…

Amadeus India Pvt. Ltd., New Delhi vs. ACIT, Circle- 2(2), New Delhi

In the result, appeal of the assessee in ITA No

ITA 7376/DEL/2018[2014-15]Status: DisposedITAT Delhi08 Mar 2021AY 2014-15

Bench: Shri N.K. Billaiya & Ms. Suchitra Kamble[A.Y 2014-15]

For Appellant: Shri Tarandeep Singh, AdvFor Respondent: Shri Surender Pal, CIT-DR
Section 143(3)Section 14ASection 92F

…not disturbed these objections but has upheld the case of the learned Transfer Pricing Officer on some other grounds, i.e., (i) by relying upon the Special Bench decision in the case of L. G. Electronics India (P.) Ltd. v. Asstt. CIT [2013] 29 taxmann.com 300/140 ITD 41 (Delhi - Trib.) [SB] ; (ii) by holding that since the appellant is a dependent agency permanent establishment of its associated enterprise hence all the expenses on advertisement, marketing and promotion are being incurred by it for the benefit of the associated enterprise, and (iii) by relying upon the amended provisions of section 92B. We do not…

Colgate Palmolive (India) Ltd, Mumbai vs. Addl CIT 10(3), Mumbai

The appeal of the assessee is partly allowed in terms of our aforesaid observations

ITA 1431/MUM/2014[2009-10]Status: DisposedITAT Mumbai08 Feb 2021AY 2009-10

Bench: Shri S.Rifaur Rahman () & Shri Ravish Sood () Ita No.1431 /Mum/2014 (Assessment Year: 2009-10) Colgate Palmolive (India) Ltd. Addl. Commissioner Of Income- Colgate Research Centre, Main Vs. Tax-10(3) Street, Hiranandani Gardens, Powai, Mumbai – 400076

For Appellant: Shri Percy Pardiwalla, Senior Advocate a/w ShriFor Respondent: Shri Sunil Deshpande, D.R
Section 143(3)Section 14ASection 80ISection 8o

…has not followed any specific method as 2006-07 is the first year, the matter could be restored to TPO to decide it afresh after considering the guidelines laid down by Special Bench (Delhi) in the case of L.G. Electronics India (P.) Ltd. v. Asstt. CIT [2013]140 ITD 41/29 taxmann.com 300. He submitted that the AE, parent company of the assessee should reimburse the expenses as assessee company has created brand in India which is owned by parent company by incurring the expenditure. 40. We have considered the order of the TPO/AO and the submissions of ld. Representatives of the parties. We observe that the TPO ha…

DCIT 10(3), Mumbai vs. Colgate Palmolive (India) Ltd, Mumbai

The appeal of the assessee is partly allowed in terms of our aforesaid observations

ITA 1350/MUM/2014[2009-10]Status: DisposedITAT Mumbai08 Feb 2021AY 2009-10

Bench: Shri S.Rifaur Rahman () & Shri Ravish Sood () Ita No.1431 /Mum/2014 (Assessment Year: 2009-10) Colgate Palmolive (India) Ltd. Addl. Commissioner Of Income- Colgate Research Centre, Main Vs. Tax-10(3) Street, Hiranandani Gardens, Powai, Mumbai – 400076

For Appellant: Shri Percy Pardiwalla, Senior Advocate a/w ShriFor Respondent: Shri Sunil Deshpande, D.R
Section 143(3)Section 14ASection 80ISection 8o

…has not followed any specific method as 2006-07 is the first year, the matter could be restored to TPO to decide it afresh after considering the guidelines laid down by Special Bench (Delhi) in the case of L.G. Electronics India (P.) Ltd. v. Asstt. CIT [2013]140 ITD 41/29 taxmann.com 300. He submitted that the AE, parent company of the assessee should reimburse the expenses as assessee company has created brand in India which is owned by parent company by incurring the expenditure. 40. We have considered the order of the TPO/AO and the submissions of ld. Representatives of the parties. We observe that the TPO ha…

DCIT Cir 6(3)(1), Mumbai vs. Idbi Federal Life Insurance Co. Ltd, Mumbai

Accordingly, the same is dismissed

ITA 6971/MUM/2017[2011-12]Status: DisposedITAT Mumbai07 Feb 2020AY 2011-12

Bench: Shri C.N. Prasad, Hon'Ble & Shri G. Manjunatha, Hon'Bledy. Commissioner Of Income- Tax V. M/S. Idbi Federal Life Insurance Circle – 6(3)(1) Company Pvt. Ltd., 22Nd Floor, A Wing, Marathon Futurex Room No. 506, 5Th Floor N.M. Joshi Marg, Lower Parel (E) Aayakar Bhavan, M.K. Road Mumbai – 400 013 Mumbai – 400 020 Pan: Aabci6227M (Appellant) (Respondent)

For Appellant: Ms. Arati VissanjiFor Respondent: Shri Awangshi Gimson
Section 10(34)Section 14ASection 44

…Insurance Limited for ITAT decision ITAT A.Ys. 2012-13 Company A.Y. 2009-10 in ICICI decision in & Limited & Prudential's ICICI Ground raised Ground A.Y. 2013-14 for 2010-11 case Prudential's No. before ITAT in A.Y. 2008-09 in in case ITA.No. 1044 & ITA.No. [140 ITD 41 in ITA.No. ITA.No. 6281 & 1045/Mum/2018 1563/Mum/2013 (Mum)] 1488/Mum/2013 6282/Mum/2012, & dated ITA.No. 6970/Mum/2017 25.01.2018 5567/Mum/2014 dated dated 24.07.2019 09.08.2017 Allowing adjustment Pages 6 to 8, Page 6, last Page 5, Page 5, Page 58, 1. from the Paras 12 to Para of Para 3 Para 7.1 Para 6 Para 19 "actuarial 15 valuation" Transfer b…

M/S Msd Pharmaceuticals (P) Ltd, New Delhi vs. DCIT, New Delhi

In the result, the appeal of the assessee is partly allowed

ITA 1423/DEL/2015[2010-11]Status: DisposedITAT Delhi23 Dec 2019AY 2010-11

Bench: Ms. Sushma Chowla & Dr. B.R.R. Kumar

For Appellant: Ms. Rashmi Chopra, Adv &For Respondent: Sh. Sanjay I. Bara, CIT DR
Section 143(3)Section 144C(1)Section 92Section 92C

…equently BLT was applied to benchmark the said transaction. The Assessing Officer acknowledges that no part of the expenditure was reimbursed by the AE, but applying the ratio laid down by the Special Bench in L.G. Electronics India (P.) Ltd. vs ACIT (2017) 140 ITD 41 (Special Bench), it was held by the Assessing Officer/TPO that the said expenditure on AMP आयकर अपील सं. / ITA No:- 1423/Del/2015 expenditure was an international transaction and since it fails the BLT test and also because the AE did not reimburse any part of the expenditure, then the said expenditure had to be benchmarked with markup. 14. The…

Icici Prudential Life Insurance Company Ltd, Mumbai vs. Asst CIT Cir 6(1), Mumbai

ITA 384/MUM/2015[2012-13]Status: DisposedITAT Mumbai22 Nov 2019AY 2012-13

Bench: Shri S. Rifaur Rahman, Am & Shri Ram Lal Negi, Jm आयकरअपीलसं./ I.T.A. No. 384/Mum/2015 (निर्धारणवर्ा / Assessment Year: 2012-13)

For Appellant: Ms. Arati Vissanji, ARFor Respondent: Shri Awangshi Gimson
Section 10Section 115BSection 143(3)Section 14ASection 44

…e heard the ld. DR as well as the ld. AR and considered the relevant material on record. The issue involved in ground No.1 to 6 of the revenue’s appeal have been considered by this Tribunal in assessee’s own case for the assessment year 2005- 06 to 2008-09 in 140 ITD 41 in para nos. 23, 27, 32, 38, 40 and 42 which are as under :- “27. Respectfully following the above principles and examining the provisions of IT Act, we are of the opinion that the 'actuarial valuation made in accordance with the Insurance Act, 1938' do mean that the actuarial valuation done in accordance with the Insurance Act, 1938. In arriving…

JCIT (OSD) Circle-8(3)(1), Mumbai vs. Tata Aia Life Insurance Co, . Ltd, Mumbai

In the result, the appeal of the Revenue is dismissed and the appeal of the assessee is allowed

ITA 1482/MUM/2018[2014-15]Status: DisposedITAT Mumbai08 Nov 2019AY 2014-15

Bench: Shri Mahavir Singh & Shri Rajesh Kumarassessment Year: 2014-15

For Appellant: Shri Nishant Thakkar, A.RFor Respondent: Shri R. Manjunatha Swamy, D.R
Section 10(34)Section 44

…he appeal of the assessee by observing and holding as under: “5.2 I have considered the facts of the issue and the submissions made by the AR, In view of the decision of the jurisdictional ITAT in case of ICICI Prudential Insurance Co Ltd v ACIT - 6(1) [2013] 140 ITD 41 (Mumbai) ICICI Pru directing to compute the income of a life insurance company based on the mechanism prescribed as per the OLD Form 1 i.e. by considering the Surplus / (Deficit) as per Form I, prepared in accordance with the Fourth Schedule to the Insurance Act, 1938 [prior to its amendment by the Insuii2uice (Amendment) Act, 2002] for the last i…

M/S. Motorola Solutions India Pvt. Ltd., Gurgaon vs. DCIT, Gurgaon

Appeal of the assessee is partly allowed for statistical purpose

ITA 5797/DEL/2012[2008-09]Status: DisposedITAT Delhi31 Oct 2019AY 2008-09

Bench: Shri N.K. Billaiya & Ms Suchitra Kamble, [Assessment Year: 2008-09]

Section 143(3)Section 144CSection 92Section 92C

…P in respect of the AMP expenditure has come to be known as the "Bright line test" which has been subject matter of extensive litigation before the Tribunal and the Hon’ble High Courts. The Special Bench of this Tribunal in the case of L.G. Electronics [2013] 140 ITD 41 held that excessive expenditure could be treated as a separate international transaction that could be subjected to arm’s length exercise on its own. While holding so, the Special Bench laid down extensive guidelines to determine the value of the international transaction and the ALP of the same. Subsequently, the Hon’ble Delhi High Court in the c…

Samsung India Electronics Pvt. Ltd., Gurgaon vs. Addl. CIT, New Delhi

ITA 1567/DEL/2014[2009-10]Status: DisposedITAT Delhi04 Oct 2019AY 2009-10

Bench: Shri Amit Shukla & Shri Prashant Maharishi

For Appellant: S/Shri Himanshu Sinha, ShriFor Respondent: Shri H.K. Choudhary, CIT-D.R

…nd the CIT(A) in respect of the AMP expenditure has come to be known as the “Bright line test” which has been subject matter of extensive litigation before the ITAT and the High Courts. The Special Bench of this Tribunal in the case of L.G. Electronics [2013] 140 ITD 41 had approved this approach and had held that excessive expenditure could be treated as a separate international transaction that could be subjected to arm’s length exercise on its own. While holding so, the Special Bench had laid down extensive guidelines to determine the value of the international transaction and the ALP of the same. Subsequently…

Samsung India Electronics Pvt. Ltd., Gurgaon vs. Addl. CIT, New Delhi

ITA 52/DEL/2013[2008-09]Status: DisposedITAT Delhi04 Oct 2019AY 2008-09

Bench: Shri Amit Shukla & Shri Prashant Maharishi

For Appellant: S/Shri Himanshu Sinha, ShriFor Respondent: Shri H.K. Choudhary, CIT-D.R

…nd the CIT(A) in respect of the AMP expenditure has come to be known as the “Bright line test” which has been subject matter of extensive litigation before the ITAT and the High Courts. The Special Bench of this Tribunal in the case of L.G. Electronics [2013] 140 ITD 41 had approved this approach and had held that excessive expenditure could be treated as a separate international transaction that could be subjected to arm’s length exercise on its own. While holding so, the Special Bench had laid down extensive guidelines to determine the value of the international transaction and the ALP of the same. Subsequently…

Sansung India Electronics Pvt. Ltd., Gurgaon vs. Addl. CIT, Special Range- 8, New Delhi

ITA 2511/DEL/2018[2011-12]Status: DisposedITAT Delhi04 Oct 2019AY 2011-12

Bench: Shri Amit Shukla & Shri Prashant Maharishi

For Appellant: S/Shri Himanshu Sinha, ShriFor Respondent: Shri H.K. Choudhary, CIT-D.R

…nd the CIT(A) in respect of the AMP expenditure has come to be known as the “Bright line test” which has been subject matter of extensive litigation before the ITAT and the High Courts. The Special Bench of this Tribunal in the case of L.G. Electronics [2013] 140 ITD 41 had approved this approach and had held that excessive expenditure could be treated as a separate international transaction that could be subjected to arm’s length exercise on its own. While holding so, the Special Bench had laid down extensive guidelines to determine the value of the international transaction and the ALP of the same. Subsequently…

Samsung India Electronics Pvt. Ltd., Gurgaon vs. JCIT, New Delhi

ITA 868/DEL/2016[2011-12]Status: DisposedITAT Delhi04 Oct 2019AY 2011-12

Bench: Shri Amit Shukla & Shri Prashant Maharishi

For Appellant: S/Shri Himanshu Sinha, ShriFor Respondent: Shri H.K. Choudhary, CIT-D.R

…nd the CIT(A) in respect of the AMP expenditure has come to be known as the “Bright line test” which has been subject matter of extensive litigation before the ITAT and the High Courts. The Special Bench of this Tribunal in the case of L.G. Electronics [2013] 140 ITD 41 had approved this approach and had held that excessive expenditure could be treated as a separate international transaction that could be subjected to arm’s length exercise on its own. While holding so, the Special Bench had laid down extensive guidelines to determine the value of the international transaction and the ALP of the same. Subsequently…