Magneti Marelli Powertrain India Pvt. Ltd. v. DCIT

389 ITR 469High Court2016#3413 most cited

What is Magneti Marelli Powertrain India Pvt. Ltd. v. DCIT authority for?

The Assessing Officer (AO) or Transfer Pricing Officer (TPO) cannot dispute the application of the TNMM method if they have already accepted it as the most appropriate method for certain international transactions, especially when other transactions are intrinsically linked.

35

judgments rely on this decision, according to BharatTax’s citation analysis of 366,339 Indian tax judgments — from 2017 to 2024.

Also referred to as

Magneti Marelli Powertrain India · TNMM · most appropriate method · TPO · AO · intra group services · benchmarking · associated enterprises · 389 ITR 469 · 143(3) · 144C

Sections most often in play

Section 143(3)Section 144C(13)Section 142(1)Section 143(2)Section 144BSection 144C(1)Section 144C(3)Section 144C(5)
Read the full judgment

Issues it is cited on

intra group servicesresale price methodcomparable uncontrolled price methodcup methodworking capital adjustmenttransactional net margin methodbenchmarking analysismost appropriate methodtested partydirections of the drptnmmassociated enterprises

Judgments citing Magneti Marelli Powertrain India Pvt. Ltd. v. DCIT

Man Diesel & Turboo India Pvt.Ltd, Aurangabad vs. Deputy Commissioner of Income-Tax, Circle - 1, Aurangbad

ITA 3042/PUN/2017[2013-14]Status: DisposedITAT Pune14 Feb 2020AY 2013-14

Bench: Shri Anil Chaturvedi & Shri S.S. Viswanethra Ravi

For Appellant: Shri Nikhil PathakFor Respondent: Shri T. Vijaya Bhaskar Reddy
Section 143(2)Section 143(3)Section 144CSection 92ASection 92C

…ther. In fact, in all the earlier years, the assessee was exclusively in the trading of components and the manufacturing activity started at the fag end of the preceding year only. 10. The assessee in Magneti Marelli Powertrain India Pvt. Ltd. vs. DCIT (2016) 389 ITR 469 (Delhi) entered into agreement with its A.E. for acquiring technology required for the purpose of manufacturing. It applied the TNMM to benchmark its international transactions of import of raw materials, sub- assemblies and components, payment of technical assistance fees, payment of royalty, payment of software and purchase of fixed assets. All…

Gbt India Private Limited, Delhi vs. ACIT, Circle-10(1), New Delhi

In the result, the appeal of the assessee in ITA No

ITA 8965/DEL/2019[2015-16]Status: DisposedITAT Delhi31 Jan 2020AY 2015-16

Bench: Shri N.K. Billaiya & Shri N.K. Choudhary[Assessment Year: 2015-16]

For Appellant: Shri Himanshu S. Sinha, AdvFor Respondent: Shri Surendra Pal, CIT- DR
Section 143(3)

…t TNMM has been accepted as the most appropriate method. It is equally true that the TPO has singled out one transaction and applied CUP as most appropriate method. 16. The Hon'ble High Court of Delhi in the case of Magneti Marelli Powertrain India Pvt Ltd 389 ITR 469 has held that when intra group services are linked to the main business activity of the company, they should be bench marked by adopting TNMM. The relevant findings of the Hon'ble High Court read as under: 17. As far as the second question is concerned, the TPO accepted TNMM applied by the assessee, as the most appropriate method in respect of…

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

In the result, the appeal of the assessee is allowed

ITA 6813/DEL/2017[2012-13]Status: DisposedITAT Delhi07 Jan 2020AY 2012-13

Bench: Ms. Sushma Chowladr. B. R. R. Kumarita No. 6813/Del/2017 : Asstt. Year : 2012-13 Samsung India Electronics Pvt. Ltd. Vs Additional Commissioner Of 20Th -24Th Floors, Dlf Two Horizon Income Tax, Special Range-8 Center, Sector-13, Gurgaon, New Delhi-110002 Haryana-122002 (Appellant) (Respondent) Pan No. Aaacs5123K Assessee By : Sh. Himanshu Sinha, Adv. Revenue By : Sh. H. K. Choudhary, Cit Dr & Date Of Hearing: 04.12.2019 Date Of Pronouncement: 07.01.2020

For Appellant: Sh. Himanshu Sinha, AdvFor Respondent: Sh. H. K. Choudhary, CIT DR &
Section 144CSection 144C(10)Section 92C

…nation of ALP this transaction can be tested separately. The ld. AR’s submissions about the applicability of the rationale of Hon’ble High Court of Delhi in the case of Magneti Marelli Powertrain India Pvt. Ltd. Vs CIT 24 Samsung India Electronics Pvt. Ltd. 389 ITR 469 has been considered. The mark-up of 1% to 5% has to be allowed as it cannot be said that the AE would be in a position to extend services to the assessee at free of cost. The observation that only one division of AE charging mark-up while others do not charge cannot be a reason to make any adjustments in the mark-up and consequently to the deprec…

Knorr Bremse Systems for Commercial Vehicles India Private Limited, ('Kb India'), Pune vs. Deputy Commissioner of Income-Tax, Circle - 14, Pune

In the result, the appeal is partly allowed for statistical

ITA 2369/PUN/2017[2013-14]Status: DisposedITAT Pune20 Dec 2019AY 2013-14

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Ravi

…y are structured in such a manner that the assessee has no option to accept one and reject the other nor they are so inextricably linked that one cannot survive without other. 21. The assessee in Magneti Marelli Powertrain India Pvt. Ltd. vs. DCIT (2016) 389 ITR 469 (Delhi) entered into agreement with its A.E. for acquiring technology required for the purpose of manufacturing. It applied the TNMM to benchmark its international transactions of import of raw materials, sub-assemblies and components, payment of technical assistance fees, payment of royalty, payment of software and purchase of fixed assets. All…

Knorr Bremse Systems for Commercial Vehicles India Private Limite, D, Pune vs. Deputy Commissioner of Income Tax

In the result, the appeal is partly allowed for statistical

ITA 187/PUN/2017[2012-13]Status: DisposedITAT Pune20 Dec 2019AY 2012-13

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Ravi

…y are structured in such a manner that the assessee has no option to accept one and reject the other nor they are so inextricably linked that one cannot survive without other. 21. The assessee in Magneti Marelli Powertrain India Pvt. Ltd. vs. DCIT (2016) 389 ITR 469 (Delhi) entered into agreement with its A.E. for acquiring technology required for the purpose of manufacturing. It applied the TNMM to benchmark its international transactions of import of raw materials, sub-assemblies and components, payment of technical assistance fees, payment of royalty, payment of software and purchase of fixed assets. All…

Knorr Bremise Systems for Commercial Vehicles India Pvt. Ltd., Pune vs. Deputy Commissioner of Income-Tax, Circle - 14, Pune

In the result, the appeal is partly allowed for statistical

ITA 1648/PUN/2017[2011-12]Status: DisposedITAT Pune20 Dec 2019AY 2011-12

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Ravi

…y are structured in such a manner that the assessee has no option to accept one and reject the other nor they are so inextricably linked that one cannot survive without other. 21. The assessee in Magneti Marelli Powertrain India Pvt. Ltd. vs. DCIT (2016) 389 ITR 469 (Delhi) entered into agreement with its A.E. for acquiring technology required for the purpose of manufacturing. It applied the TNMM to benchmark its international transactions of import of raw materials, sub-assemblies and components, payment of technical assistance fees, payment of royalty, payment of software and purchase of fixed assets. All…

Man Diesel & Turbo India Private Ltd., Aurangabad vs. Assistant Commissioner of Income Tax, Aurangabad

In the result, the appeal is dismissed

ITA 1049/PUN/2017[2012-13]Status: DisposedITAT Pune09 Dec 2019AY 2012-13

Bench: Shri R.S. Syal & Shri Partha Sarathi Chaudhuryआयकर अपील सं. / Ita No.1049/Pun/2017 िनधा"रण वष" / Assessment Year : 2012-13 Man Diesel & Turbo India Private Vs. Acit, Circle-1 Limited, Aurangabad E-73, Midc, Waluj, Aurangabad – 431 136 Pan : Aaacm0320L Appellant Respondent

Section 143(3)

…r. In fact, in all the earlier years, the assessee was exclusively in the trading of components and the manufacturing activity started at the fag end of the preceding year only. 10. The assessee in Magneti Marelli Powertrain India Pvt. Ltd. vs. DCIT (2016) 389 ITR 469 (Delhi) entered into agreement with its A.E. for acquiring technology required for the purpose of manufacturing. It applied the TNMM to benchmark its international transactions of import of raw materials, sub-assemblies and components, payment of technical assistance fees, payment of royalty, payment of software and purchase of fixed assets. All…

Assistant Commissioner of Income-Tax, Circle -11, Pune vs. Ina Bearings India Private Limited, Pune

In the result, appeal of the assessee in ITA No

ITA 1940/PUN/2017[2012-13]Status: DisposedITAT Pune30 Jul 2019AY 2012-13

Bench: Shri R.S.Syal, Vp & Shri Partha Sarathi Chaudhury, Jm आयकर अपीऱ सं. / Ita No.1911/Pun/2017 नििाारण वषा / Assessment Year : 2012-13 Ina Bearings India Pvt. Ltd. Plot No.A3, Talegaon Industrial Area, Navalkh Umbre, Tal. Maval Talegaon, Pune-410 507. Pan : Aaaci7163H .......अऩीऱाथी / Appellant बिाम / V/S. The Deputy Commissioner Of Income Tax, Circle-11, Pune. ……प्रत्यथी / Respondent आयकर अपीऱ सं. / Ita No.1940/Pun/2017 नििाारण वषा / Assessment Year : 2012-13 The Assistant Commissioner Of Income Tax, Circle-11, Pune. .......अऩीऱाथी / Appellant बिाम / V/S. Ina Bearings India Pvt. Ltd. Plot No.A3, Talegaon Industrial Area & Floriculture Area, Village- Ambi, Navlakha Umbre, Tal. Maval Talegaon, Pune-410 507. Pan : Aaaci7163H ……प्रत्यथी / Respondent Assessee By : Ms. Amrin Pathan & Shri Sandeep Shah Revenue By : Shri Sandip Garg, Cit सुनवाई की तारीख / Date Of Hearing : 30.07.2019 घोषणा की तारीख / Date Of Pronouncement : 30.07.2019 A.Y.2012-13

For Appellant: Ms. Amrin Pathan &For Respondent: Shri Sandip Garg, CIT
Section 92(1)Section 92BSection 92CSection 92C(1)Section 92F

…al or any such understanding or any inextricable link between these transactions as one not surviving without the other as has been spelt out in the case of Knorr- Bremse (supra). 10. The assessee in Magneti Marelli Powertrain India Pvt. Ltd. vs. DCIT (2016) 389 ITR 469 (Delhi) entered into agreement with its A.E. for acquiring technology required for the purpose of manufacturing. It applied the TNMM to benchmark its international transactions of import of raw materials, sub-assemblies and components, payment of technical assistance fees, payment of royalty, payment of software and purchase of fixed assets. All…

Ina Bearings India Pvt.Ltd, Pune vs. Deputy Commissioner of Income-Tax, Circle - 11, Pune

In the result, appeal of the assessee in ITA No

ITA 1911/PUN/2017[2012-13]Status: DisposedITAT Pune30 Jul 2019AY 2012-13

Bench: Shri R.S.Syal, Vp & Shri Partha Sarathi Chaudhury, Jm आयकर अपीऱ सं. / Ita No.1911/Pun/2017 नििाारण वषा / Assessment Year : 2012-13 Ina Bearings India Pvt. Ltd. Plot No.A3, Talegaon Industrial Area, Navalkh Umbre, Tal. Maval Talegaon, Pune-410 507. Pan : Aaaci7163H .......अऩीऱाथी / Appellant बिाम / V/S. The Deputy Commissioner Of Income Tax, Circle-11, Pune. ……प्रत्यथी / Respondent आयकर अपीऱ सं. / Ita No.1940/Pun/2017 नििाारण वषा / Assessment Year : 2012-13 The Assistant Commissioner Of Income Tax, Circle-11, Pune. .......अऩीऱाथी / Appellant बिाम / V/S. Ina Bearings India Pvt. Ltd. Plot No.A3, Talegaon Industrial Area & Floriculture Area, Village- Ambi, Navlakha Umbre, Tal. Maval Talegaon, Pune-410 507. Pan : Aaaci7163H ……प्रत्यथी / Respondent Assessee By : Ms. Amrin Pathan & Shri Sandeep Shah Revenue By : Shri Sandip Garg, Cit सुनवाई की तारीख / Date Of Hearing : 30.07.2019 घोषणा की तारीख / Date Of Pronouncement : 30.07.2019 A.Y.2012-13

For Appellant: Ms. Amrin Pathan &For Respondent: Shri Sandip Garg, CIT
Section 92(1)Section 92BSection 92CSection 92C(1)Section 92F

…al or any such understanding or any inextricable link between these transactions as one not surviving without the other as has been spelt out in the case of Knorr- Bremse (supra). 10. The assessee in Magneti Marelli Powertrain India Pvt. Ltd. vs. DCIT (2016) 389 ITR 469 (Delhi) entered into agreement with its A.E. for acquiring technology required for the purpose of manufacturing. It applied the TNMM to benchmark its international transactions of import of raw materials, sub-assemblies and components, payment of technical assistance fees, payment of royalty, payment of software and purchase of fixed assets. All…

Woodward India Pvt. Ltd., Gurgaon vs. DCIT, New Delhi

The appeal of the assessee stands partly allowed

ITA 916/DEL/2015[2009-10]Status: DisposedITAT Delhi25 Mar 2019AY 2009-10

Bench: Shri N.K. Billaiya & Shri Sudhanshu Srivastavaassessment Year: 2009-10 Woodward India Pvt. Ltd., Dcit, (Formerly Known As Woodward Circle-18(1), Governor India Ltd.,), 12Th Floor, New Delhi. Vs Building No. 5, Dlf Cyber Terraces, Dlf Cyber City, Phase-Iii, Gurgaon-122002 Appellant Respondent Assessee By : Shri Vishal Kalra, Adv. Shri S.S. Tomer, Adv. Department By: Shri H.K. Choudary, C.I.T. Dr Date Of Hearing: 17.01.2019 Date Of Pronouncement: 25.03.2019

For Appellant: Shri Vishal Kalra, AdvFor Respondent: Shri H.K. Choudary, C.I.T. DR
Section 92Section 92C

…his would lead to chaos and be detrimental to the interests of both the assessee and the revenue. For this, we draw support from the judgment of the Hon’ble Delhi High Court in the case of Magneti Marelli Powertrain India (P) Ltd. vs. DCIT reported in (2016) 389 ITR 469 (Del.) wherein the Hon’ble Delhi High Court has upheld the finding of the Delhi Tribunal in Magneti Marelli Powertrain India (P) Ltd. vs. DCIT reported in (2014) taxmann.com 155 (Delhi – Trib.). 5.4 We also find it appropriate to mention that the TPO, in the subsequent years, has accepted the aggregate approach and the TNMM method as against…

M/S. Eaton Power Quality Private Ltd., Pune vs. Deputy Commissioner of Income-Tax

In the result, the appeal of assessee in ITA No

ITA 1373/PUN/2014[2007-08]Status: DisposedITAT Pune11 Sept 2018AY 2007-08

Bench: Shri Anil Chaturvedi, Am & Shri Vikas Awasthy, Jm

For Appellant: Shri Vishal KalraFor Respondent: Shri Rajeev Kumar
Section 143(3)

…ions wherein it has been held that closely linked transactions should be aggregated and benchmarked together:  Sony Ericsson Mobile Communications India (P) Ltd vs CIT [2015]374 ITR 118 (Delhi)  Magneti Marelli Powertrain India (P.) Ltd. vs CIT Delhi) [2016]389 ITR 469 (Delhi)  Avery Dennison (India) (P.) Ltd. vs ACIT ITA Nos. 4869 & 4934/De1/2014; upheld by the Hon'ble Delhi High Court in PrCIT vs Avery Dennison (India) Pvt Ltd (ITA 386/2016)  Cummins India Limited vs ACIT: [2015]68 SOT 14 (Pune-Trib.)  Godrej Sara Lee Ltd. vs ACIT ITA No. 598 of 2013 (Mum)  Kusum Healthcare (P) Ltd vs ACIT [2015] 42 ITR (…

M/S Eaton Power Quality P.Ltd., Pune vs. ACIT, Pune

In the result, the appeal of assessee in ITA No

ITA 119/PUN/2013[2008-09]Status: DisposedITAT Pune11 Sept 2018AY 2008-09

Bench: Shri Anil Chaturvedi, Am & Shri Vikas Awasthy, Jm

For Appellant: Shri Vishal KalraFor Respondent: Shri Rajeev Kumar
Section 143(3)

…ions wherein it has been held that closely linked transactions should be aggregated and benchmarked together:  Sony Ericsson Mobile Communications India (P) Ltd vs CIT [2015]374 ITR 118 (Delhi)  Magneti Marelli Powertrain India (P.) Ltd. vs CIT Delhi) [2016]389 ITR 469 (Delhi)  Avery Dennison (India) (P.) Ltd. vs ACIT ITA Nos. 4869 & 4934/De1/2014; upheld by the Hon'ble Delhi High Court in PrCIT vs Avery Dennison (India) Pvt Ltd (ITA 386/2016)  Cummins India Limited vs ACIT: [2015]68 SOT 14 (Pune-Trib.)  Godrej Sara Lee Ltd. vs ACIT ITA No. 598 of 2013 (Mum)  Kusum Healthcare (P) Ltd vs ACIT [2015] 42 ITR (…

Gamesa Renewable Private Limited, Chennai vs. ACIT, Chennai

In the result, both the appeals of the assessee are partly allowed for statistical purposes

ITA 376/CHNY/2017[2012-13]Status: DisposedITAT Chennai13 Nov 2017AY 2012-13

Bench: Shri Chandra Poojari & Shri Duvvuru Rl Reddy

For Appellant: Shri B.Ramakrishnan, FCA &For Respondent: Smt. Vijayalakshmi, CIT,D.R
Section 143(3)Section 144C(1)Section 144C(5)

…following decisions, wherein it has been held that where the PLI of the assessee is determined under TNMM, a separate analysis and consequent deletion of royalty / technical fee payment is unwarranted: 1. Magneti Marelli Powertrain India (P) Ltd. vs DCIT (389 ITR 469) (Delhi) 2. DCIT vs. Air Liquide Engineering India (P) Ltd. (43 Taxmann.com 299(Hyd.) 3. Daksh Business Process Services (P) Ltd. vs. DCIT (Delhi-ITAT) 2666/Del./2014) 4. ACIT vs. Sakata Inx (India) Ltd. (Jaipur-ITAT) (ITA No.376/Jaipur/2012) 4.2 The ld. AR submitted that the transactions entered into by the assessee with its AE are at arm’s len…

Gamesa Renewable Private Limited, Chennai vs. DCIT, Chennai

In the result, both the appeals of the assessee are partly allowed for statistical purposes

ITA 1420/CHNY/2017[2011-12]Status: DisposedITAT Chennai13 Nov 2017AY 2011-12

Bench: Shri Chandra Poojari & Shri Duvvuru Rl Reddy

For Appellant: Shri B.Ramakrishnan, FCA &For Respondent: Smt. Vijayalakshmi, CIT,D.R
Section 143(3)Section 144C(1)Section 144C(5)

…following decisions, wherein it has been held that where the PLI of the assessee is determined under TNMM, a separate analysis and consequent deletion of royalty / technical fee payment is unwarranted: 1. Magneti Marelli Powertrain India (P) Ltd. vs DCIT (389 ITR 469) (Delhi) 2. DCIT vs. Air Liquide Engineering India (P) Ltd. (43 Taxmann.com 299(Hyd.) 3. Daksh Business Process Services (P) Ltd. vs. DCIT (Delhi-ITAT) 2666/Del./2014) 4. ACIT vs. Sakata Inx (India) Ltd. (Jaipur-ITAT) (ITA No.376/Jaipur/2012) 4.2 The ld. AR submitted that the transactions entered into by the assessee with its AE are at arm’s len…

M/S. Gruner India Pvt. Ltd., New Delhi vs. DCIT, New Delhi

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 771/DEL/2017[2012-13]Status: DisposedITAT Delhi16 Jun 2017AY 2012-13

Bench: Sh. N. K. Saini, Am & Sh. Kuldip Singh, Jm Ita No. 771/Del/2017 : Asstt. Year : 2012-13 Gruner India Pvt. Ltd. Vs Deputy Commissioner Of Income C/O-S.S. Kothari Mehta & Co., Tax, Circle-10(2), Chartered Accountants, 146, New Delhi Tribhuvan Complex, Ishwar Nagar, Mathura Road, New Delhi-110065 (Appellant) (Respondent) Pan No. Aadcg2938H Assessee By : Sh. H. P. Agarwal, Adv. Revenue By : Sh. Amendra Kumar, Cit Dr Date Of Hearing : 27.03.2017 Date Of Pronouncement : 16.06.2017 Order Per N. K. Saini, Am: This Is An Appeal By The Assessee Against The Order Dated 19.01.2017 Of The Ao Passed U/S 143(3) R.W.S. 144C(13) Of The Income Tax Act, 1961 (Hereinafter Referred To As The Act).

For Appellant: Sh. H. P. Agarwal, AdvFor Respondent: Sh. Amendra Kumar, CIT DR
Section 143(3)Section 234BSection 80ISection 92CSection 92D

…gment in favour of the assessee and remitted back the case 8 Gruner India Pvt. Ltd. to the TPO for reconsideration of the aggregation approach in view of the ratio laid down in the following cases: " Magneti Marelli Powertrain India Pvt. Ltd. vs DCIT [(2016) 290 CTR 60 (Del) " Sony Ericsson Mobile Communication India (P) Ltd. vs CIT (2015) 374 ITR 118 (Del.) Copies of the aforesaid orders of the Hon’ble Delhi High Court in the case of the assessee and M/s Magneti Marelli was furnished which are placed at page nos. 45 to 64 of the assessee’s paper book. 10. The ld. Counsel for the assessee submitted that the pro…