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TMI Blog2021 (9) TMI 1079X X X X Extracts X X X X X X X X Extracts X X X X ..... e AMP activities of the assessee should be aggregated with other international transactions of the assessee, in absence of evidence from the assessee to prove that these transactions are homogenous and interlinked? 2. Whether in the facts and circumstances of the case and in law, the Ld. CIT(A) was justified in holding that commission is an appropriate remuneration for the marketing and support services which have been rendered by the Assessee? 3. Whether in the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in not appreciating the fact that brand building and creation of marketing intangibles is a separate function altogether, and thus requires separate benchmarking? 4. Whether under the facts and circumstan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h is in the case of distributor company. 6. On the other hand, learned Counsel of the assessee refuted the claim of the Learned DR and submitted that assessee is importee of trade goods and not manufacture and therefore squarely covered by the decision of the Hon'ble Delhi High Court in the case of Sony Ericsson (supra). 7. We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. The brief profile of the assessee mentioned by the Ld. CIT(A) has not been disputed by the parties and therefore for ready reference, we are extracting the same as under: "5.2 The appellant provides marketing and service support to the existing dealer network or Karl Storz Germany in India. It also s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... BI. Thus the TPO made an addition of account marketing intangibles developed by the appellant as a result of marketing expenditure on the basis of Bright Line Test (BLT)." 7.1. The Learned CIT(A) has deleted the transfer pricing addition observing as under: "5.7 The main contention of the appellant and an admitted fact that the appellant is providing marketing/and support services which had already been remunerated by the AE as commission which covers not only the expenses incurred by the appellant but also a reasonable return for such expenses and activities. The commission income received by the appellant is in lieu of marketing support services to the exiting dealer network in India and hence the marketing expenditure of the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in case of Sony Ericsson(supra), it is held that the transfer pricing adjustments made by the TPO gives rise to an incongruous situation as such expenses are factored in the net profit of the inter linked transactions as stated by the Hon'ble Delhi High Court in the case of Sony Ericsson (supra):- "This would be also in consonance with Rule 10B(1)(e), which mandates only arriving at the net profit margin by comparing the profits and loss assumption that functions, assets and risk being broadly similar and once suitable adjustments have been made, all things get taken into account and stand reconciled when computing the net profit margin. Once the comparables pass the functional analysis test and adjustments have been made, then the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficer himself has not made any transfer pricing adjustment on account of AMP expenses in same set of circumstances and, therefore, keeping in view of the principle of the consistency, the Assessing Officer is not justified in making adjustment in the year under consideration. 7.3. Further, we note that the assessee has already been remunerated for the marketing expenses incurred on behalf of the AEs along with commission markup, and, therefore, there was no requirement of making separate AMP addition in the case of the assessee. 7.4. In view of the above facts and circumstances, we do not find any error or infirmity in the order of the Ld. CIT(A) on the issue in dispute and accordingly, uphold the same. The grounds raised by the Revenue a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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