Pr. Commissioner of Income Tax-6, New Delhi v. MSD Pharmaceuticals Pvt. Ltd.

1. For the reasons as stated in the application, the delay in filing is ITA Nos. 432/2017 <£ 524/2017 p„gg j gfj 2017:DHC:8737-DB condoned. The application stands disposed of. CM No.25168/2017 (exemption) in ITA No.524/2017

2. Allowed, subject to alljust exceptions. ITA No.524/2017 and ITA No.432/2017

3. These appeals by the Revenue and Assessee are directed against the same order dated 22"^^ November, 2016 passed by the Income Tax Appellate Tribunal ('ITAT') in ITA No. 1423/Del/2015 for the Assessment Year ('AY') 2010-11. ITA No.524/2017 has been preferred by the Revenue and ITA No.432/2017 has been preferred by the Assessee.

4. The dispute before the Tribunal concerns the addition oftransfer pricing adjustment on account ofAdvertisement, Marketing and Promotion (AMP) Expenditure purportedly incurred by the Assessee. The ITAT in the impugned order has referred to the decision of this Court inSony Ericson Mobile Communications (India) Pvt. Ltd. v. CIT (2015) 374ITR 118 (Del) and also some of the subsequent judgments where the Court has held that in matters of transfer pricing the first exercise that is to be undertaken is to determine if in fact there existed an international transaction between the Assessee at its Associated Enterprise. Only if the said question is answered in the affirmative, the further question of determining its arm's length price would arise. Counsel on both sides state that all the necessary documents and information for determining the above question already form part of the record of the case in the ITAT. nd

5. In view ofthe above submissions, the Court sets aside the order dated 22 ITA Nos. 432/2017 & 524/2017 Page 2 of[3] November, 2016 and restore the aforementioned appeal to the file of the ITAT for a fresh de novo adjudication on merits without reference to the orderof the ITATthathasbeen set aside bythisjudgment.

6. It will be opento both sides to urge their respective contentions on merits before the ITAT which will be decided afresh without reference to the order of theITAT thathas been setaside bythis judgment.

7. Ms. Rashmi Chopra, learned counsel for the Assessee, states that in view ofthis order the Assessee will withdraw the miscellaneous application filed by it before the ITAT.

8. The appeal ITA No. 1423/Del/2015 be listed before the ITAT on 28"^ August, 2017for directions. Theappeals are disposed of in the above terms. JULY 19, 2017 dk ITA Nos. 432/2017 & 524/2017 S.MURALIDHAR, J PRATHIBA M. SINGb(3J Page 3 of[3]