“bright line test”

M/S. BOSE CORPORATION INDIA PVT. LTD.,NEW DELHI vs. ACIT, NEW DELHI

In the result, both the appeals of the assessee are allowed

Bench: Shrivikas Awasthy & Shrisanjay Awasthiआ.अ.सं/.I.T.A Nos.1595 & 1596/Del/2017 िनधा"रणवष"/Assessment Years: 2007-08 & 2008-09 बनाम Bose Corporation India P. Ltd., Acit, Salcon Aurum, 3Rd Floor, Plot No.4, Vs. Circle 5(1), Room No.390, Jasola District Centre, C.R. Building, I.P. Estate, New Delhi. New Delhi. Pan No.Aaacb3260A अपीलाथ" Appellant ""यथ"/Respondent

following cases: i) Sony Ericsson case (supra); it has been held that while AMP expenses can be treated as International Transaction but the Bright Line Test is invalid. In fact in this case it has been held that the BLT has no statutory mandate and it is not necessary ... been approved. To further underscore this point the paragraph 121 of the Sony Ericsson case (supra) deserves to be extracted as under: - “Applying ‘bright line test’ on the basis of parameters prescribed in paragraphs 17.4 and 17.6 would be adding and writing words in the statute and the rules

M/S. BOSE CORPORATION INDIA PVT. LTD.,NEW DELHI vs. ACIT, NEW DELHI

Bench: Shrivikas Awasthy & Shrisanjay Awasthiआ.अ.सं/.I.T.A Nos. 1595 & 1596/Del/2017 निर्धारणवर्ष/Assessment Years: 2007-08 & 2008-09 Bose Corporation India P. Ltd., बनाम Salcon Aurum, 3Rd Floor, Plot No.4, Vs. Acit, Jasola District Centre, Circle 5(1), Room No.390, C.R. Building, I.P. Estate, New Delhi. New Delhi. Pan No.Aaacb3260A अपीलार्थी Appellant प्रत्यर्थी/Respondent Assessee By Shri Ajay Vohra, Sr. Advocate & Shri Ravi Pratap Mall, Advocate Revenue By Shri Dharm Veer Singh, Cit Dr सुनवाईकीतारीख / Date Of Hearing: 05.01.2026 उद्घोषणाकीतारीख /Pronouncement On 23.01.2026 आदेश /Order Per Sanjay Awasthi: 1. This Is A Batch Of Two Appeals Pertaining To The Same Assessee For Ay 2007-08 & 2008-09. Since The Issues Are By & Large Common For Both The Years, These Two Cases Are Being Disposed Of Through A Common Order. 2.

ITA Nos. 1595 & 1596/Del/2017 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH "I"NEW DELHI BEFORE SHRIVIKAS AWASTHY, JUDICIAL MEMBER

SWATCH GROUP (INDIA) PRIVATE LIMITED,NEW DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 22(2), C.R. BUILDING

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

Bench: Shri Challa Nagendra Prasad & Shri Brajesh Kumar Singh[Assessment Year: 2021-22] Swatch Group (India) Private Deputy Commissioner Of Income Limited, Tax, 4Th Floor, Rectangle-I, Plot No. D- Vs Circle 22(2), 4, Saket District Centre, C.R. Building, I.P. Estate, Delhi, New Delhi-110017. 110002. Pan- Aafcs7516R Assessee Revenue

Appeal set) as to why adjustment in the AMP expenses should not be made by applying Bright Line Test. The relevant extract of the said show cause notice is reproduced as under: “Advertising, marketing expenditure incurred on behalf of AE On perusal of information submitted by Assessee it is seen ... India. Primary Approach -Bright Line In relation to advertising, marketing and promotion expenses, this office has taken a stand that bright line test should be applied and any non-routine expenditure 3 ITA No.- 5929/Del/2024 Swatch Group (India) Pvt. Ltd. incurred by the assessee in excess of the expenditure incurred

AMWAY INDIA ENTERPRISES PRIVATE LIMITED,NEW DELHI vs. DCIT, CIRCLE 1(1), DELHI / NFAC, DELHI

Appeal of the assessee is allowed

Bench: Shri Sudhir Pareek & Shri Manish Agarwalamway India Enterprises Private Dcit, Limited, Circle-1(1), Ground Floor, Elegance Tower, Vs. Delhi/Nfac. Plot No.8, Non Hierarchical Commercial, Jasola, Delhi-110025. Pan-Aaaca5603Q (Appellant) (Respondent)

fully dependent upon the sales achieved and has nothing to do with the product building exercise. 13. With regard to the application of bright line test (though no addition is made), the Hon’ble Delhi High Court in the case of Maruti Suzuki India ... further the Hon’ble Delhi High Court in the case of CIT (LTU) v. Whirlpool of India Ltd., 381 ITR 154 held that bright line test is not a valid method for determination of existence of international transaction or determination of arm’s length price. Therefore, in the instant case

SONY INDIA PRIVATE LIMITED,DELHI vs. ACIT CIRCLE 22(2), , DELHI

In the result, appeal filed by the assessee is partly allowed as indicated above

Bench: Shri S. Rifaur Rahman & Ms. Madhumita Roysony India Private Limited, Vs. Acit, Circle 22 (2), A – 18, Mohan Cooperative Indl. Area, New Delhi. Mathura Road, New Delhi – 110 044. (Pan :Aabcs1571Q) (Appellant) (Respondent) Assessee By : Shri Nageshwar Rao, Advocate Shri Parth, Advocate Revenue By : Shri S.K. Jadhav, Cit Dr Date Of Hearing : 23.09.2025 Date Of Order : 12.11.2025 O R D E R Per S. Rifaur Rahman: 1. This Appealpreferred By The Assesseeis Directed Against The Assessment Order Dated 30.07.2024Passed By The Assessment Unit, Income Tax Department Under Section 143(3) Read With Section 144C(13) R.W.S. 144Bof The Income-Tax Act, 1961 (For Short ‘The Act”) For Assessment Year 2020- 21Pursuant To The Directions Of The Dispute Resolution Panel U/S 144C(5) Of The Act Raising Following Grounds Of Appeal :-

making 'intensity adjustment' to adjust net 3 profit margin of comparable companies purportedly to equalise functions. 'Intensity adjustment' is mirror image of Bright Line Test (BLT) both are already invalidated by Hon'ble Courts. 7. Without prejudice to all other grounds, impugned order errs in quantifying AMP expense of appellant ... import of finished goods. Protective Transfer Pricing Adjustment in respect of international transaction for Marketing and Market Development functions ("MMDF") based on Bright Line Test ("BLT") approach In law and facts of present case: 4 15. Impugned order errs in retaining protective assessment based on BLT Contrary

LG ELECTRONICS INDIA PRIVATE LIMITED,MATHURA ROAD, NEW DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, DELHI

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

Bench: Shri Mahavir Singh & Shri M. Balaganesh

international transaction within the meaning of Section 92B of the Act. For this purposes, he undertook benchmarking analysis of AMP expenditure applied Bright Line Test by comparing ratio of AMP expenditure to the sales of the assessee with that of the comparable companies and held that any expenditure in excess ... promotion of the brand/ trade name owned by the AE, requiring suitable compensation from the AE. The ld TPO for applying bright line test compared AMP expenditure incurred by the assessee as percentage of total turnover @9.56% with average AMP expenses of of 3.69% of various comparable companies

LG ELECTRONICS INDIA PRIVATE LIMITED ,NEW DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, DELHI

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

Bench: Shri Mahavir Singh & Shri M. Balaganesh

international transaction within the meaning of Section 92B of the Act. For this purposes, he undertook benchmarking analysis of AMP expenditure applied Bright Line Test by comparing ratio of AMP expenditure to the sales of the assessee with that of the comparable companies and held that any expenditure in excess ... promotion of the brand/ trade name owned by the AE, requiring suitable compensation from the AE. The ld TPO for applying bright line test compared AMP expenditure incurred by the assessee as percentage of total turnover @9.56% with average AMP expenses of of 3.69% of various comparable companies

DCIT, CIRCLE-13(1), NEW DELHI vs. LG ELECTRONICS INDIA PVT. LTD., DELHI

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

Bench: Shri Mahavir Singh & Shri M. Balaganesh

international transaction within the meaning of Section 92B of the Act. For this purposes, he undertook benchmarking analysis of AMP expenditure applied Bright Line Test by comparing ratio of AMP expenditure to the sales of the assessee with that of the comparable companies and held that any expenditure in excess ... promotion of the brand/ trade name owned by the AE, requiring suitable compensation from the AE. The ld TPO for applying bright line test compared AMP expenditure incurred by the assessee as percentage of total turnover @9.56% with average AMP expenses of of 3.69% of various comparable companies

DCIT, CIRCLE-15(2), NEW DELHI vs. LG ELECTRONICS INDIA PVT. LTD., NEW DELHI

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

Bench: Shri Mahavir Singh & Shri M. Balaganesh

international transaction within the meaning of Section 92B of the Act. For this purposes, he undertook benchmarking analysis of AMP expenditure applied Bright Line Test by comparing ratio of AMP expenditure to the sales of the assessee with that of the comparable companies and held that any expenditure in excess ... promotion of the brand/ trade name owned by the AE, requiring suitable compensation from the AE. The ld TPO for applying bright line test compared AMP expenditure incurred by the assessee as percentage of total turnover @9.56% with average AMP expenses of of 3.69% of various comparable companies

LG ELECTRONICS INDIA PVT. LTD.,NEW DELHI vs. DCIT, CIRCLE-15(2), NEW DELHI

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

Bench: Shri Mahavir Singh & Shri M. Balaganesh

international transaction within the meaning of Section 92B of the Act. For this purposes, he undertook benchmarking analysis of AMP expenditure applied Bright Line Test by comparing ratio of AMP expenditure to the sales of the assessee with that of the comparable companies and held that any expenditure in excess ... promotion of the brand/ trade name owned by the AE, requiring suitable compensation from the AE. The ld TPO for applying bright line test compared AMP expenditure incurred by the assessee as percentage of total turnover @9.56% with average AMP expenses of of 3.69% of various comparable companies

LG ELECTRONICS INDIA PVT. LTD.,NEW DELHI vs. ADDL. CIT, SPECIAL RANGE- 5, NEW DELHI

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

Bench: Shri Mahavir Singh & Shri M. Balaganesh

international transaction within the meaning of Section 92B of the Act. For this purposes, he undertook benchmarking analysis of AMP expenditure applied Bright Line Test by comparing ratio of AMP expenditure to the sales of the assessee with that of the comparable companies and held that any expenditure in excess ... promotion of the brand/ trade name owned by the AE, requiring suitable compensation from the AE. The ld TPO for applying bright line test compared AMP expenditure incurred by the assessee as percentage of total turnover @9.56% with average AMP expenses of of 3.69% of various comparable companies

LG ELECTRONICS INDIA PVT. LTD.,NEW DELHI vs. ADDL. CIT, SPECIAL RANGE- 5, NEW DELHI

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

Bench: Shri Mahavir Singh & Shri M. Balaganesh

international transaction within the meaning of Section 92B of the Act. For this purposes, he undertook benchmarking analysis of AMP expenditure applied Bright Line Test by comparing ratio of AMP expenditure to the sales of the assessee with that of the comparable companies and held that any expenditure in excess ... promotion of the brand/ trade name owned by the AE, requiring suitable compensation from the AE. The ld TPO for applying bright line test compared AMP expenditure incurred by the assessee as percentage of total turnover @9.56% with average AMP expenses of of 3.69% of various comparable companies

M/S LG ELECTRONICS INDIA PVT. LTD.,,NEW DELHI vs. DCIT, NOIDA

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

Bench: Shri Mahavir Singh & Shri M. Balaganesh

international transaction within the meaning of Section 92B of the Act. For this purposes, he undertook benchmarking analysis of AMP expenditure applied Bright Line Test by comparing ratio of AMP expenditure to the sales of the assessee with that of the comparable companies and held that any expenditure in excess ... promotion of the brand/ trade name owned by the AE, requiring suitable compensation from the AE. The ld TPO for applying bright line test compared AMP expenditure incurred by the assessee as percentage of total turnover @9.56% with average AMP expenses of of 3.69% of various comparable companies

DCIT, NOIDA vs. M/S. L.G. ELECTRONICS INDIA PVT. LTD., GREATER NOIDA

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

Bench: Shri Mahavir Singh & Shri M. Balaganesh

international transaction within the meaning of Section 92B of the Act. For this purposes, he undertook benchmarking analysis of AMP expenditure applied Bright Line Test by comparing ratio of AMP expenditure to the sales of the assessee with that of the comparable companies and held that any expenditure in excess ... promotion of the brand/ trade name owned by the AE, requiring suitable compensation from the AE. The ld TPO for applying bright line test compared AMP expenditure incurred by the assessee as percentage of total turnover @9.56% with average AMP expenses of of 3.69% of various comparable companies

SONY INDIA PRIVATE LIMITED,NEW DELHI vs. ACIT, CIRCLE-22(2), DELHI

Bench: Shri Anubhav Sharma & Shri Manish Agarwal

making‘intensity adjustment' to adjust net profit margin of comparable companies purported to equalise functions. ‘Intensity adjustment' is mirror image of Bright Line Test (‘BLT') already invalidated by Hon'ble Courts. 6. Without prejudice to all other grounds, impugned order errs in quantifying AMP expense of appellant by including expenses