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TMI Blog2024 (10) TMI 869X X X X Extracts X X X X X X X X Extracts X X X X ..... rnational Transaction' rested its view on Sony Ericsson Mobile Communications India Pvt. Ltd. [ 2015 (3) TMI 580 - DELHI HIGH COURT ] Foreign exchange gain/loss - to be considered as an item of operating revenue/cost - Those questions too stand answered against the appellant in light of the judgment rendered in ITA 206/2016 [ 2016 (3) TMI 1272 - DELHI HIGH COURT ] ITAT has in the impugned order noted the fact that the foreign exchange gain earned by the Assessee is in relation to the trading items emanating from the international transactions. Since the foreign exchange loss directly resulted from trading items, it could not be considered as a non-operating loss. As noted by the Dispute Resolution Panel that the service agreement betwee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in holding that the Brightline Test was not mandated in law and hence impermissible without considering the facts that BLT was not used as a method to determine the price but only as an economic tool to arrive at the cost of services rendered to foreign enterprises by the Indian entity and when the TP0 has the mandate to determine such cost as a primary step in ALP determination as provided under the Rules? C. Whether, on the facts and circumstances of the case and in law, the Hon'ble ITAT was justified in stating that the existence of an international transaction cannot be arrived at, from the clauses of an MDF agreement and also stating that the value of international transaction cannot be expanded beyond the reimbursements receive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uation, Provision for doubtful debts Provisions written back as non-operating cost/revenue of the tested party as well as of the comparables to eliminate the differences, thereby leading to a consistent and reliable basis for comparison? H. Whether, on the facts and circumstances of the case and in law, the Hon'ble ITAT erred in holding that forex gain/loss could not be made the subject matter of adjustment, without further holding that even if this were to be the case, appropriate adjustments were required to be carried out under Rule 10B (3) of the Income Tax Rules so as to eliminate the differences in factors like credit period allowed and risk-management policy between the comparables and the assessee? 2. We note that insofar as que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence of an international transaction cannot be arrived at, from the clauses of an MDF agreement and also stating that the value of international transaction cannot be expanded beyond the reimbursements received under MDF agreement and that incurred of AMP expenditure does not lead to Brand Building? 2.4 Whether, on the facts and circumstances of the case and in law, the Id. ITAT was right in law in observing that on application of TNMM as the Most Appropriate Method at segmental/entity level, then individual component of AMP cannot be segregated for benchmarking, when the TPO is fully empowered for segregation/aggregation of transactions as per the LT. Act and International guidance for Arm's Length determination? 2.5 Whether, on the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unexceptionable. 3. That only leaves us to examine the findings which were returned in respect of three comparables. We note that the assessee company is stated to be engaged in the business of manufacturing and distributing various Samsung products falling in the consumer electronics and home appliances category. We are, however, in the present appeal concerned with the trading segment of the aforesaid operations. 3. That only leaves us to examine the issues which are sought to be canvassed and pertain to foreign exchange gain/loss. Those questions too stand answered against the appellant in light of the judgment rendered in ITA 206/2016 dated 23 March 2016. We take note of the following observations as they appear in that decision: 3. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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