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2014 (7) TMI 951 - AT - Income TaxAdmission of additional ground - Provision for Warranty – Held that:- The Tribunal has the jurisdiction to examine a question of law which arises from the facts as found by the authorities below and having a bearing on tax liability of the assessee notwithstanding the fact that it was not raised before the CIT(A) - Following the decision in M/s. Rotork Controls India (P) Ltd. Versus Commissioner of Income Tax, Chennai [2009 (5) TMI 16 - SUPREME COURT OF INDIA] - as the assessee did not make claim for deduction of provision for warranty and claimed it on actual basis, the addition ground of the assessee for allowing deduction deserves to be admitted. Transfer pricing adjustment - Advertisement, marketing and sales promotion expenses - Held that:- The AMP expenses refer only to advertisement, marketing and publicity and the selling expenses which are specific to sales cannot be considered within the ambit of AMP expenses - the expenses for the promotion of sales are to be considered within the purview of AMP expenses, whereas the expenses in connection with the sales which are simply sales specific, are outside the scope of AMP expenses - Following the decision in LG Electronics Pvt. Ltd. vs. ACIT [2013 (6) TMI 217 - ITAT DELHI] - when the assessee is claiming deduction in the computation of total income for the amount used during the year only and the balance amount of provision is carried forward, it is natural that the carried forward amount of the provision which would become brought forward balance in the subsequent year would become relevant for claiming deduction towards the amount used during the year - the AO should keep in mind that this amount of provision should not lead to double deduction, firstly at the time of creation of provision in the current year and then at the time of actual use of the amount in subsequent years - the AO would examine the claim for deduction of provision for warranties, only to the extent for which no deduction has been claimed on actual basis in the year or subsequent years out of provision – Decided in favour of Assessee.
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