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2019 (7) TMI 1516 - AT - Income Tax
TP Adjustment - AMP expenditure - international transaction - whether incurring of the AMP expenditure by the assessee is an international transaction, or not ? - HELD THAT:- The aforesaid issue under consideration is squarely covered by the order passed by the Tribunal in the assesses own case for A.Y. 2010-11 [2018 (1) TMI 1033 - ITAT MUMBAI] .
Admittedly, the “distribution agreement” which had been effective from 28.04.2007 was renewable automatically on year-to-year basis and involving the same terms and conditions was applicable during the period relevant to A.Y.2010-11. Accordingly, the terms of the distribution agreement had not changed/modified. Also, we find that the similarly placed “distribution Agreement” was relied upon by the Tribunal while disposing off the appeal of the assessee for the immediately preceding year viz. A.Y. 2008-09. A perusal of the order of the Tribunal in the assesses own case for A.Y. 2010-11, viz. India Medtronic Vs. DCIT-10(1)(1), Mumbai [2018 (1) TMI 1033 - ITAT MUMBAI] reveals that the Tribunal had observed viz. (i) that, in the agreements between the assessee and its AE there was no condition of sharing of AMP; (ii) that, the agreements only referred to using best efforts to distribute the products or promote products in a commercially reasonable manner; and (iii) that, the terms of the agreement did not provide that the assessee had to share AMP expenses; (iv) that, even if the AE was benefitted indirectly by the AMP expenditure incurred by the assessee, it could not be inferred that it had entered into an agreement for sharing AMP expenses; and (v) that, the “Bright Line Test‟ should not have been applied by the TPO. We find that the Tribunal after relying on its earlier order in the case of Thomas Cook India Ltd. [2016 (7) TMI 318 - ITAT MUMBAI] had therein decided the issue in favour of the assessee.
Non granting the consequential depreciation on non-compete fees as the same was held to be in the nature of a capital expenditure in A.Y. 2002-03 - HELD THAT:- As perused the order of the Tribunal passed in the first round of appeal and find that no such contention of the assessee as regards its entitlement towards depreciation of non-compete fees was remanded by the Tribunal to the file of the A.O. Accordingly, respectfully following the directions of the Hon‟ble High Court that other issues raised in the first round of appeal (except those remanded) are not to be re-adjudicated by the Tribunal, therefore, we refrain from adverting to and therein adjudicating the aforesaid claim of the assessee which as observed by us hereinabove, arises from a fact that had not been remanded by the Tribunal to the file of the A.O for fresh adjudication.