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2018 (5) TMI 936 - AT - Income TaxExpenses towards marketing sales and promotional kits - Allowable business expenses OR brand building either of the assessee or of the foreign associated enterprise - scope of tpa - Held that:- Marketing sales and promotional kits relate to the distribution of price lists, book and brochures etc. to the customers; marketing-sponsorship relating to promotion/exhibitions etc., free sample cost relating to the distribution of free sample activities of books to prospective customers/colleges/book stores/authors etc.; and free samples cost-free courier and packaging relate to the freight carrier cost for distribution of free sample copies of books. Revenue failed to give any interpretation to these expenses other than the one explained by the learned authorised representative. It is not known how any of these expenses relate to the brand building either of the assessee or of the foreign associated enterprise. All the four expenses as the head suggests relate to the promotion of the sales of the product and not in any way connected to the brand building. Thus the expenses relate to the business of the assessee alone for promotion of the sales of the products i.e. the books and such an expense had nothing to do with the brand promotion of any of them. With this view we are of the considered opinion that the approach of the Transfer Pricing Officer is not in accordance with law laid down in the case of Sony Ericsson Mobile Communications India Pvt. Ltd. (2015 (3) TMI 580 - DELHI HIGH COURT) and cannot be sustained. We, therefore, direct the learned Assessing Officer to delete the same. - Decided in favour of assessee
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