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2022 (6) TMI 338 - AT - Income TaxTP Adjustment - AMP expenditure as International Transaction - pre-requisite for commencing the TP exercise - AO/TPO treating AMP as a separate international transaction - using bright line test from benchmarking - incurring expenditure on account of advertisement, marketing and promotion, under influence or control of the AE - HELD THAT:- CIT(A) held that there is a rationale to factor in AMP intensity adjustment while equating the functional profit into the comparables in TNMM benchmarking. The "bright line test" which is the mirror image of intensity approach has no statutory mandate. Hence, cannot be upheld. With regard to the receivables, we hold that the netting of interest paid or receivables as sought by the assessee may be accorded and the benefit of brought forward losses be allowed as per the provisions of Income Tax Act. Appeals of the assessee are allowed.
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