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TMI Blog2017 (2) TMI 1388X X X X Extracts X X X X X X X X Extracts X X X X ..... al apart from the confirmation of certain non-transfer pricing additions. The Revenue is also aggrieved against the deletion of two non-transfer pricing additions. I. TRANSFER PRICING ADDITIONS A. TP addition on Import of crystal and crystal components 2.1. The first challenge in the assessee's appeal is to the addition on account of transfer pricing adjustment in respect of 'Import of crystal and crystal components'. Briefly stated, the facts of the case are that the assessee company, with its original name of Swaropearl, was incorporated in India in 1996. It is a part of Swarovski group, a globally famous brand for crystal and crystal related products. It is a world-wide market leader in crystal jewellery and accessories, grinding an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was available for all its sales to group companies (internal comparable). It was also submitted that its AE also made direct sales of crystal components to Indian customers and the amount charged from such independent customers was higher than that charged from the assessee (external comparable). The assessee submitted that it was also taking orders on behalf of its AE from customers in India and forwarding the same for execution to its AE, on which commission @15% of invoice value was being allowed to it. The sum and substance of the assessee's submissions before the TPO was that the price charged by its AE from any other country through its group company/branch office was the same as that charged from customers in India. 2.2. The TPO, fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the CUP method by the authorities below has been upheld and further direction has been given to the AO/TPO for a fresh determination of the ALP of this transaction, firstly, by considering the application of RPM and if, due to one reason or the other, the same cannot be applied, then, the TNMM. Detailed discussion made in our order for the A.Y. 2004-05 is applicable and should be read as a part of this order also, to be followed by the TPO in such fresh determination. B. TP addition on AMP Expenses 3.1. During the course of first appellate proceedings, the ld. CIT(A) observed that no transfer pricing analysis was done in respect of the international transaction of advertisement, marketing and promotion (AMP) expenses. The assessee was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vt. Ltd. (for the AY 2010-11), the question as to whether AMP expenses is an international transaction, has been restored for a fresh determination. There are three recent judgments of the Hon'ble Delhi High Court, viz., Rayban Sun Optics India Ltd. VS. CIT (dt. 14.9.2016), Pr. CIT VS. Toshiba India Pvt. Ltd. (dt. 16.8.2016) and Pr. CIT VS. Bose Corporation (India) Pvt. Ltd. (dt. 23.8.2016) in all of which similar issue has been restored for fresh determination in the light of the earlier judgment in Sony Ericsson Mobile Communications India Pvt. Ltd. (supra). Respectfully following the predominant view of the Hon'ble High Court, we are of the considered opinion that it would be in the fitness of things if the impugned order is set aside an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e cropped up before us in appeal of the assessee for the A.Y. 2004-05. This issue has been discussed in detail in such order. As no fresh arguments have been made, similar findings will apply, mutatis mutandis, to the instant year as well. To sum up, the amount of provision is not deductible. Actual amount of write off has to be allowed as deduction u/s 36(1)(vii). Reversal of provision should not lead to taxable income. However, deduction allowed in respect of provision for doubtful debts for the A.Y. 2003-04 should be taken into consideration while allowing deduction on actual write off or reversal of provisions to the relevant extent so that no double deduction gets allowed. 6.1. The first ground taken by the Revenue in its appeal is ag ..... X X X X Extracts X X X X X X X X Extracts X X X X
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