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2019 (5) TMI 1541 - AT - Income TaxValidity of the assessment order u/s 144C(13) - provisions of sec.144C(13) do not extend the time limit prescribed in sec.153 - HELD THAT:- We notice that various benches of Tribunal are taking the view that the provisions of sec.144C(13) give extension of further period of one month from the end of month in which the direction of DRP was received. In the instant case, there is no dispute that the assessing officer has passed the assessment order within one month from the end of the month in which direction of DRP was received. Accordingly, consistent with the view taken by various benches of Tribunal, we reject the legal ground urged by the assessee. Disallowance made u/s 40(a)(i) - payments made by the assessee for purchase of softwares as “Royalty” - HELD THAT:- Since the payments have been made for purchase of software, we are of the view that the decision rendered by Hon’ble jurisdictional Karnataka High Court in the case of Samsung Electronics Co Ltd [2011 (10) TMI 195 - KARNATAKA HIGH COURT] is applicable to the facts of the present case. A.R has raised an alternative contention that the disallowance u/s 40(a)(i) should be restricted to the portion of payment which is chargeable to tax in India. Since this alternative contention was not raised before the AO, the same requires examination at his end. Accordingly we restore this alternative contention to the file of the AO for examining the same in accordance with law. TP adjustment in respect of Advertisement and Market promotion (AMP) expenses - A.R submitted that the TPO has followed Bright Line Test (BLT) in order to determine the alleged excess expenses incurred by the assessee towards AMP expenses - HELD THAT:- The Hon’ble Delhi High Court has held in the case of Maruti Suzuki Ltd [2015 (12) TMI 634 - DELHI HIGH COURT] that the revenue needs to establish the existence of international transaction before undertaking benchmarking of AMP expenses. In the instant case, we notice that the TPO has entertained the belief on the basis of presumptions that the assessee’s AMP expenses have promoted the brand value of its AE, i.e., no material has been brought on record to show the existence of International transaction. Before us, the Ld A.R placed his reliance on various case laws. We notice that the decision rendered in the case of L.G. Electronics India P Ltd vs. ACIT [2019 (1) TMI 1567 - ITAT DELHI] is applicable to the facts of the present case, wherein also identical T.P adjustment had been made and held Since the operating margins of the assessee are in excess of the selected comparable companies, no adjustment on account of AMP expenses is warranted AO/TPO was not justified in making T.P adjustment on account of AMP expenses. Accordingly we hold that no adjustment needs to be done in respect of AMP expenses and accordingly delete the addition made by the AO in this regard. - Decided in favour of assessee.
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