The problem with the Revenue’s approach is that it wants every instance of an AMP spend by an Indian entity which happens to use the brand of a foreign AE to be presumed to involve an international transaction. And this, notwithstanding that this is not one of the deemed international transactions listed under the Explanation to Section 92B of the Act
The transfer pricing adjustment is not expected to be made by deducing from the difference between the ‘excessive’ AMP expenditure incurred by the Assessee and the AMP expenditure of a comparable entity that an international transaction exists and then proceeding to make the adjustment of the difference in order to determine the value of such AMP expenditure incurred for the AE
The transfer pricing adjustment made by the ld TPO of Rs. 73,23,49,876/- on account of arm’s length price of alleged international transaction of AMP expenditure is unsustainable
The TPO, while framing the order u/s 92CA(3) of the Act, was well aware with the decision of the Hon’ble jurisdictional High Court of Delhi in the case of Sony Ericcson Mobile Communication India Pvt Ltd reported at 276 CTR 97, and therefore, it cannot be said that the TPO was not aware that the Bright Line test has been discarded by the Hon’ble High Court of Delhi