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

DCIT 8(3), Mumbai vs. Reliance Life Insurance Company Ltd, Mumbai

In the result, appeal is dismissed

ITA 5999/MUM/2014[2011-12]Status: DisposedITAT Mumbai24 Aug 2016AY 2011-12

Bench: Shri Saktijit Dey & Shri Nabin Kumar Pradhan

For Appellant: Shri Jitendra SanghviFor Respondent: Shri Goli Srinivas Rao
Section 14ASection 44

…6.12.2014; ii) SBI Life Insurance Co. Ltd. v/s JCIT, ITA no.3800, 3801 & 1501/Mum./2008, order dated 23.5.2014; iii) ACIT v/s HDFC Standard Life Insurance Co. Ltd., ITA no.3004/Mum./2012, dated 20.9.2013; iv) ICICI Prudential Life Insurance Co. Ltd. v/s ACIT, 140 ITD 41; v) Birla Sun Life Insurance Co. Ltd. v/s DCIT, ITA no.602/Mum./ 2009, dated 9.9.2010; vi) M/s. Agriculture Insurance Co. of India Ltd. v/s DCIT, ITA no.3115/Del./2013, dated 1.3.2016; vii) General Insurance Corp. of India v/s ACIT, ITA no.3554/Mum./ 2011, order dated 15.2.2010; viii) JCIT v/s Reliance General Insurance Co. Ltd., ITA no.3085/ Mum.…

DCIT Cir 6(3), Mumbai vs. Mattel Toys(India) P. Ltd, Mumbai

ITA 4350/MUM/2014[2008-09]Status: DisposedITAT Mumbai08 Jul 2016AY 2008-09
For Appellant: S/Shri Ajit Kumar Jain, Pranith GolechaFor Respondent: Shri N.K. Chand
Section 115Section 143(3)Section 254(1)

…आयकर अपीलीय अिधकरण, मुंबई “केकेकेके” खंडपीठ Income-tax Appellate Tribunal -“K”Bench Mumbai सव"ी सव"ी सव"ी राजे"" सव"ी राजे"" राजे"",लेखा सद"य राजे"" लेखा सद"य लेखा सद"य एवं लेखा सद"य एवं एवं सी एवं सी सी. . . . एन सी एन एन. . . . "साद एन "साद "साद,"याियक सद"य "साद "याियक सद"य "याियक सद"य "याियक सद"य Before S/Shri Rajendra,Accountant Member and C.N. Prasad,Judicial Member आयकर अपील सं आयकर अपील सं././././ITA/4350/Mum/2014,िनधा"रण वष" आयकर अपील सं आयकर अपील सं िनधा"रण वष" िनधा"रण वष" /Assessment Year: 2008-09 िनधा"रण वष" Dy. CIT-6(3) M/s. Mattel Toys (India) Pvt. Ltd. Room No.522, 5th Floor, Phoenix House, “B”Wi…

Thomas Cook (India) Ltd, Mumbai vs. Addl CIT 1(3), Mumbai

ITA 1261/MUM/2015[2009-10]Status: DisposedITAT Mumbai31 May 2016AY 2009-10

Bench: S/Sh.Rajendra & C.N. Prasadआयकर अपील सं आयकर अपील सं././././I.T.A./ 1261 & 1238/Mum/2015, आयकर अपील सं आयकर अपील सं िनधा"रण िनधा"रण वष" िनधा"रण िनधा"रण वष" वष" /Assessment Year: 2009-10 & 2010-11 वष" Thomas Cook (India) Limited Dcit-1 (3)(2) Thomas Cook Building Mumbai. Vs. Dr. D.N. Road, Fort,Mumbai-400 001. Pan:Aaact 4050 C (अपीलाथ" /Appellant) (""यथ" / Respondent) Revenue By:Shri N.K. Chand-Cit Assessee By: Shri Madhur Agarwal सुनवाई की तारीख / Date Of Hearing: 04.05.2016 घोषणा की तारीख / Date Of Pronouncement: 31.05.2016 आयकर अिधिनयम,1961 की धारा 254(1)के अ"ग"त आदेश Order U/S.254(1)Of The Income-Tax Act,1961(Act) लेखा सद" राजे" के अनुसार Per Rajendra, Am- Challenging The Orders Dated 08.12.2014 & 24.12.2014 Of Cit(A)-58 & Of The Assesssing Officer(Ao),The Assessee Has Filed The Appeals For The Above Mentioned Two Assessment Years(Ay.S.).Assessee-Company, Engaged In The Business Of Tour Operator,Travel Agent & Is Also An Authorised Dealer In Foreign Exchange.The Details Of Filing Of Returns,Returned Incomes,Assessed Incomes Etc.Can Be Summarised As Under: A.Y. Roi Filed On Returned Assessment Assessed Dt. Of Orders Of Income(Rs.) Dt. Income(Rs.) Cit(A)/Ao 2009-10 30.09.2009 44,28,33,999/- 28/03/2013 46,8432,558/- 08.12.2014 2010-11 30.09.2010 37,15,77,109/- 16/01/2015 57,86,82,443/- 16.01.2015

For Appellant: Shri Madhur AgarwalFor Respondent: Shri N.K. Chand-CIT
Section 254(1)Section 92C

…sions,the DR argued that up to the date of decision in the case of Maruti Suzuki(dated 11/12/2015),the benefit of the decision was not available to the authorities below-TPO, A.O,CIT(A),DRP-that in the light of the earlier decisions and particularly LG's case(140 ITD 41)the TPOs and other authorities proceeded in a manner following the Bright Line Test,that in certain cases, references could also have been made to the agreements between the parties i.e., Indian entity and foreign AEs.,that in some cases, Bright Line Test had been followed and the expenditure on AMP has been sliced into two portions,that the non-r…

ACIT 5(1), Mumbai vs. Cadbury India Ltd, Mumbai

ITA 5876/MUM/2012[2005-06]Status: DisposedITAT Mumbai18 May 2016AY 2005-06
For Appellant: Shri J.D. Mistry, Nishant Thakkar &For Respondent: S/Shri N.K.Chand-CIT
Section 143(3)Section 254(1)

…आयकर आयकर आयकर अपीलीय आयकर अपीलीय अपीलीय अिधकरण अपीलीय अिधकरण अिधकरण, मुंबई अिधकरण मुंबई मुंबई “केकेकेके” खंडपीठ मुंबई खंडपीठ खंडपीठ खंडपीठ Income-tax Appellate Tribunal -“K”Bench Mumbai सव"ी राजे"",लेखा सद"य एवं सी. एन. "साद,"याियक सद"य Before S/Sh.Rajendra,Accountant Member and C.N. Prasad,Judicial Member आयकर आयकर अपील आयकर आयकर अपील अपील संसंसंसं./I.T.A./5470/Mum/2012,िनधा"रण अपील िनधा"रण िनधा"रण वष" िनधा"रण वष" वष" /Assessment Year: 2005-06 वष" Mondelez India Foods Private Addl. CIT, Range-5(1) Limited Mumbai. (formerly known as M/s. Cadbury India Limited), Mondelez House, Unit Vs. No.2001, 20th Floor, Tower…

L'Oreal India P.Ltd, Mumbai vs. Addl CIT RG 6(3), Mumbai

ITA 7714/MUM/2012[2008-09]Status: DisposedITAT Mumbai04 May 2016AY 2008-09
For Appellant: Shri Nishant Thakkar and Ms. Jasmin AmalsadualaFor Respondent: Shri N.K. Chand-CIT
Section 254(1)Section 92

…आयकर आयकर अपीलीय आयकर आयकर अपीलीय अपीलीय अिधकरण अपीलीय अिधकरण अिधकरण, , , , मुंबई अिधकरण मुंबई मुंबई “केकेकेके” खंडपीठ मुंबई खंडपीठ खंडपीठ खंडपीठ Income-tax Appellate Tribunal -“K”Bench Mumbai सव"ी राजे"",लेखा सद"य एवं सी. एन. "साद,"याियक सद"य Before S/Sh.Rajendra,Accountant Member and C.N. Prasad,Judicial Member आयकर आयकर अपील आयकर आयकर अपील अपील संसंसंसं./I.T.A./7714/Mum/2012,िनधा"रण अपील िनधा"रण िनधा"रण वष" िनधा"रण वष" वष" /Assessment Year: 2008-09 वष" LÓreal India Private Limited DCIT-6(3) A-Wing, 8th Floor, Aayakar Bhavan, M.K. Road Marathon Futurex, N.M. Joshi Marg, Vs. Mumbai-400 001. Lower Parel,Mumbai…

M/S. Fujifilm India Private Limited, New Delhi vs. DCIT, New Delhi

Accordingly the appeal filed by the assessee stands statistically allowed

ITA 6916/DEL/2014[2010-11]Status: DisposedITAT Delhi29 Apr 2016AY 2010-11

Bench: Shri N. K. Saini & Smt. Beena Pillai

For Appellant: Sh. Nageshwar Rao, AdvFor Respondent: Sh. Amendra Kumar, CIT DR
Section 92

…IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH ‘I’, NEW DELHI BEFORE SHRI N. K. SAINI, ACCOUNTANT MEMBER AND SMT. BEENA PILLAI, JUDICIAL MEMBER I.T.A. NoS.6916 & 2535/Del/2014 (Assessment Years 2009-10 & 2010-11) Fujifilm India Pvt. Ltd. Vs. DCIT, Circle 11(1), C-1/114, Ground Floor, New Delhi Near Mata Chanan Devi Hospital And Lal Sai Mandir, Janakpuri, New Delhi GIR / PAN :AABCF1594J I.T.A.No. 424/Del/2016 (Assessment Year 2011-12) Fujifilm India Pvt. Ltd. Vs. DCIT, Circle 11(1), C-1/114, Ground Floor, New Delhi Near Mata Chanan Devi Hospital And Lal Sai Mandir, Janakpuri, New Delhi GIR / PAN :AABCF1594J…

Pnb Metlife India Insurance Company Limited, Bangalore vs. Pr. CIT, Bangalore

In the result, appeal of the assessee is allowed

ITA 756/BANG/2015[2010-11]Status: DisposedITAT Bangalore29 Apr 2016AY 2010-11

Bench: Shri. Abraham P. George

For Appellant: Shri. K. P. Kumar, Senior CounselFor Respondent: Shri. G. R. Reddy, CIT – DR-I
Section 115BSection 143(3)Section 263Section 27ASection 44

…as policy holders surplus/deficit account. Assessee also pointed out that the issue regarding aggregation of results in the shareholders account and revenue account had come up before the Mumbai Tribunal in the case of ICICI Prudential Ltd v. ACIT ((2013) 140 ITD 41). As per the assessee, it was held by the Mumbai bench in the said decision that income in the shareholders account were to be taxed as a part of life-insurance business only. Further as per the assessee, while computing its profit and gains from life-insurance business, it had considered the actual valuation made in accordance with Insurance Ac…

M/S Essilor India P Ltd, Bangalore vs. Deputy Commissioner of Income Tax, Bangalore

In the result, the both the appeals are treated as partly allowed

ITA 227/BANG/2015[2010-11]Status: DisposedITAT Bangalore05 Feb 2016AY 2010-11

Bench: Shri Vijay Pal Rao & Shri Inturi Rama Raoit(Tp)A No.29/Bang/2014 (Assessment Year: 2009-10) & It(Tp)A No.227/Bang/2015 (Assessment Year: 2010-11) M/S.Essilor India Pvt.Ltd. No.71/1, Brigade Plaza, 6Th Floor, S C Road, Gandhinagar, Bangalore-9. … Appellant Pan:Aaace 4623 J Vs. Deputy Commissioner Of Income-Tax, Circle 11(3), Bangalore. … Respondent

For Appellant: Shri S.Ramasubramanyam, CAFor Respondent: Smt. Neera Malhotra, CIT(DR)
Section 143(3)Section 14ASection 234C

…IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH, BANGALORE BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER and SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER IT(TP)A No.29/Bang/2014 (Assessment year: 2009-10) and IT(TP)A No.227/Bang/2015 (Assessment year: 2010-11) M/s.Essilor India Pvt.Ltd. No.71/1, Brigade Plaza, 6th floor, S C Road, Gandhinagar, Bangalore-9. … Appellant PAN:AAACE 4623 J Vs. Deputy Commissioner of Income-tax, Circle 11(3), Bangalore. … Respondent Appellant by : Shri S.Ramasubramanyam, CA Respondent by : Smt. Neera Malhotra, CIT(DR) Date of hearing : 08/12/2015 Date of pronouncement : 05/02/2016 O R D E R P…

Honda Siel Power Products Limited vs. Deputy Commissioner of Income Tax

The appeal is allowed but in the circumstances no orders as to

ITA-346/2015HC Delhi23 Dec 2015
Section 260ASection 92C

…ITSAT in LG Electronics 9. In the meanwhile a Special Bench of the ITAT considered the issue of TP adjustment in the context of incurring of AMP expenses by Indian entities using brand names of foreign AEs in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del). By a majority of 2:1, the Special Bench of the ITAT inter alia decided as under: (i) A TP adjustment in relation to AMP expenses incurred by the Assessee for creating and improving the marketing intangibles for its foreign AE was permissible. (ii) Earning the mark up from the AE in respect of AMP expenses incurred by the foreign AE…

Bausch & Lomb Eyecare (India) Pvt. Ltd

The appeals of the Assessee are allowed and the appeals of the Revenue

ITA/165/2015HC Delhi23 Dec 2015
Section 260A

…onsidered the issue of TP adjustment in relation to AMP expenses incurred by Indian entities for improving the market intangibles for their respective AEs. By a majority of 2:1, the Special Bench of the ITAT in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del) adopted the ‘Bright Line Test’ (‘BLT’) for determining the existence of an international transaction involving AMP expenses as well as for determining the ALP. It was held that if the expense incurred by the Assessee on AMP was higher than what was incurred by an independent entity behaving in a commercially rational manner, then the TP…

Bausch & Lomb Eyecare (India) Pvt. Ltd

The appeals of the Assessee are allowed and the appeals of the Revenue

ITA/677/2014HC Delhi23 Dec 2015
Section 260A

…onsidered the issue of TP adjustment in relation to AMP expenses incurred by Indian entities for improving the market intangibles for their respective AEs. By a majority of 2:1, the Special Bench of the ITAT in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del) adopted the ‘Bright Line Test’ (‘BLT’) for determining the existence of an international transaction involving AMP expenses as well as for determining the ALP. It was held that if the expense incurred by the Assessee on AMP was higher than what was incurred by an independent entity behaving in a commercially rational manner, then the TP…

Honda Siel Power Products Limited vs. Deputy Commissioner of Income Tax

The appeal is allowed but in the circumstances no orders as to

ITA/346/2015HC Delhi23 Dec 2015
Section 260ASection 92C

…ITSAT in LG Electronics 9. In the meanwhile a Special Bench of the ITAT considered the issue of TP adjustment in the context of incurring of AMP expenses by Indian entities using brand names of foreign AEs in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del). By a majority of 2:1, the Special Bench of the ITAT inter alia decided as under: (i) A TP adjustment in relation to AMP expenses incurred by the Assessee for creating and improving the marketing intangibles for its foreign AE was permissible. (ii) Earning the mark up from the AE in respect of AMP expenses incurred by the foreign AE…

Bausch & Lomb Eyecare (India) Pvt. Ltd

The appeals of the Assessee are allowed and the appeals of the Revenue

ITA/676/2014HC Delhi23 Dec 2015
Section 260A

…onsidered the issue of TP adjustment in relation to AMP expenses incurred by Indian entities for improving the market intangibles for their respective AEs. By a majority of 2:1, the Special Bench of the ITAT in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del) adopted the ‘Bright Line Test’ (‘BLT’) for determining the existence of an international transaction involving AMP expenses as well as for determining the ALP. It was held that if the expense incurred by the Assessee on AMP was higher than what was incurred by an independent entity behaving in a commercially rational manner, then the TP…

Bausch & Lomb Eyecare (India) Pvt. Ltd

The appeals of the Assessee are allowed and the appeals of the Revenue

ITA/950/2015HC Delhi23 Dec 2015
Section 260A

…onsidered the issue of TP adjustment in relation to AMP expenses incurred by Indian entities for improving the market intangibles for their respective AEs. By a majority of 2:1, the Special Bench of the ITAT in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del) adopted the ‘Bright Line Test’ (‘BLT’) for determining the existence of an international transaction involving AMP expenses as well as for determining the ALP. It was held that if the expense incurred by the Assessee on AMP was higher than what was incurred by an independent entity behaving in a commercially rational manner, then the TP…

Bausch & Lomb Eyecare (India) Pvt. Ltd

The appeals of the Assessee are allowed and the appeals of the Revenue

ITA/166/2015HC Delhi23 Dec 2015
Section 260A

…onsidered the issue of TP adjustment in relation to AMP expenses incurred by Indian entities for improving the market intangibles for their respective AEs. By a majority of 2:1, the Special Bench of the ITAT in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del) adopted the ‘Bright Line Test’ (‘BLT’) for determining the existence of an international transaction involving AMP expenses as well as for determining the ALP. It was held that if the expense incurred by the Assessee on AMP was higher than what was incurred by an independent entity behaving in a commercially rational manner, then the TP…

Bausch & Lomb Eyecare (India) Pvt. Ltd

The appeals of the Assessee are allowed and the appeals of the Revenue

ITA/675/2014HC Delhi23 Dec 2015
Section 260A

…onsidered the issue of TP adjustment in relation to AMP expenses incurred by Indian entities for improving the market intangibles for their respective AEs. By a majority of 2:1, the Special Bench of the ITAT in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del) adopted the ‘Bright Line Test’ (‘BLT’) for determining the existence of an international transaction involving AMP expenses as well as for determining the ALP. It was held that if the expense incurred by the Assessee on AMP was higher than what was incurred by an independent entity behaving in a commercially rational manner, then the TP…

Bausch & Lomb Eyecare (India) Pvt. Ltd

The appeals of the Assessee are allowed and the appeals of the Revenue

ITA/643/2014HC Delhi23 Dec 2015
Section 260A

…onsidered the issue of TP adjustment in relation to AMP expenses incurred by Indian entities for improving the market intangibles for their respective AEs. By a majority of 2:1, the Special Bench of the ITAT in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del) adopted the ‘Bright Line Test’ (‘BLT’) for determining the existence of an international transaction involving AMP expenses as well as for determining the ALP. It was held that if the expense incurred by the Assessee on AMP was higher than what was incurred by an independent entity behaving in a commercially rational manner, then the TP…

The Commissioner of Income Tax-Ltu vs. Whirlpool of India Ltd

ITA/228/2015HC Delhi22 Dec 2015
Section 260

…10/2014 and 228/2015 Page 3 of 35 considered by the Special Bench of the ITAT in a batch of cases. By a majority of 2:1, the Special Bench of the ITAT in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del), inter alia decided: (i) A TP adjustment in relation to AMP expenses incurred by the Assessee for creating and improving the marketing intangibles for its foreign AE was permissible. (ii) Earning the mark up from the AE in respect of AMP expenses incurred by the foreign AE was also allowed. 4. The majority of the ITAT adopted the…

The Commissioner of Income Tax-Ltu vs. Whirlpool of India Ltd

ITA/610/2014HC Delhi22 Dec 2015
Section 260

…10/2014 and 228/2015 Page 3 of 35 considered by the Special Bench of the ITAT in a batch of cases. By a majority of 2:1, the Special Bench of the ITAT in LG Electronics India Pvt. Ltd. v. ACIT (2013) 140 ITD 41 (Del), inter alia decided: (i) A TP adjustment in relation to AMP expenses incurred by the Assessee for creating and improving the marketing intangibles for its foreign AE was permissible. (ii) Earning the mark up from the AE in respect of AMP expenses incurred by the foreign AE was also allowed. 4. The majority of the ITAT adopted the…

Tata Aig General Insurance Company Ltd, Mumbai vs. DCIT 2(3), Mumbai

In the result, appeals of the revenue are dismissed, whereas appeals of the assessee are allowed, in terms indicated hereinabove

ITA 4167/MUM/2012[2008-09]Status: DisposedITAT Mumbai20 Nov 2015AY 2008-09
For Appellant: Shri F.V.IraniFor Respondent: Manjunatha R. Swamy
Section 10(34)Section 143(3)Section 14A

…and considered the relevant material on record. The Ld. AR of the assessee has submitted that Rule 14A is not applicable in the case of Insurance Company. She has relied upon the decision of this Tribunal in case of ICICI Prudential Insurance Co. Ltd. Vs ACIT 140 ITD 41. On the other hand, the Ld. DR has submitted that when the income is non-assessable to tax being exempt then the provisions of section 14A shall be applied. This issue has been considered and decided by the Tribunal in case of ICICI Prudential Insurance Co. Ltd. Vs ACIT (supra) in para 46 as under: "46. This issue is already decided by the Coordin…