SAMSUNG INDIA ELECTRONICS PVT. LTD., GURGAON Vs ADDL. CIT., SPECIAL RANGE -8, NEW DELHI

This appeal concerns Samsung India Electronics Pvt. Ltd. and its challenge against an income tax assessment for the Assessment Year 2013-14. The core issues involve a significant transfer pricing adjustment made by the tax authorities, specifically relating to advertising, marketing, and promotion (AMP) expenses and international transactions within the trading segment. Samsung argues that the AMP expenditure incurred in India should not be classified as an 'international transaction' under the Income Tax Act.

IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH: ‘I-2’ NEW DELHI
BEFORE SHRI N. K. BILLAIYA, ACCOUNTANT MEMBER
AND
MS SUCHITRA KAMBLE, JUDICIAL MEMBER
I.T.A. No. 7285/DEL/2018 (A.Y 2013-14)
(THROUGH VIDEO CONFERENCING)

Samsung India Electronics Pvt.
Ltd. 20th-24th Floors, DLF Two
Horizon Centre, Sector-43,
Gurgaon, Haryana-122002
PAN: AAACSS123K
(APPELLANT)

Vs

Addl. CIT(A),
Special Range-8,
Room NO. 199A, 1st Floor, C.
R. Building, I.P. Estate
New Delhi-110002
(RESPONDENT)

Appellant by Sh. Himanshu S. Sinha &
Sh. Bhoowan Dhupar, Adv
Respondent by Sh. Anupam Kant Garg,
CIT(DR)
Date of Hearing 01.10.2020
Date of Pronouncement 14.12.2020

ORDER

PER SUCHITRA KAMBLE, JM

This appeal is filed by the assessee against the order dated 31/10/2018passed under Section 254/143(3) read with Section 144 C of the Income Tax Act, 1961 passed by Addl. CIT(A), New Delhi, for Assessment Year 2013-14.

2. The grounds of appeal are as under:-

GROUNDS OF APPEAL

“1. That on the facts and circumstances of the case and in law, the Ld. AO has erred in assessing the total income of the Appellant at Rs.27,96,96,74,360/- as against the returned income of Rs.

2. That on the facts and circumstances of the case and in law, the Ld. Dispute Resolution Panel (‘DRP’)/A.O/ Transfer Pricing Officer (“TPO”) erred in making a transfer pricing adjustment of Rs.3,01,87,69,854/-- on account of (i) advertising, marketing, promotion (“AMP”-1T) expenses of – RS. 46,38,28,605/- and (ii) international transactions pertaining to trading segment of Rs. 2,55,49,41,249/-- alleging the same to be not at arm’s length in terms of the provisions of section 92C of the Act read with Rule 10B of the Income Tax Rules, 1962 (“the Rules”).

GROUNDS AGAINST ADJUSTMENT MADE IN RELATION TO AMP EXPENSES

3. That on the facts and circumstances of the case and in law, the Ld. DRP/AO/TPO have erred in holding that the AMP expenditure incurred by the Appellant in India is an ‘international transaction’ as per the provisions of the Act.

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