India vs Whirlpool of India Ltd, July 2022, Income Tax Appellate Tribunal, Case ITA No. 476/Del/2021

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Category: Benchmark, Range and Median, Transfer Pricing Methods | Tag: , , , ,
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Whirlpool of India Ltd, a subsidiary of the Whirlpool group, distributes Whirlpool products in India and incurs advertising, marketing and promotion (AMP) expenses.

An assessment had been issued by the Indian tax authorities for the fiscal year 2016-17 in which the AMP expenses incurred by Whirlpool of India were treated as an international transaction on behalf of other companies in the Whirlpool group, resulting in a significant adjustment to Whirlpool India’s taxable income.

Whirlpool filed an appeal which was heard by the Income Tax Appellate Tribunal.

Decision

The Tribunal set aside the assessment and ruled in favor of Whirlpool. It found that the assessment lacked substantial evidence that AMP’s expenses were incurred for the benefit of other group companies.

An application for appeal by the tax authorities to the Supreme Court of India was dismissed in November 2024.

 

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