Supreme Court Dismisses Revenue SLPs In Samsung India's Transfer Pricing Case Over 609 Days Gross Delay
The Supreme Court on 31 August dismissed the Income Tax Department's Special Leave Petitions (SLPs) against the Delhi High Court's judgment in Samsung India Electronics Pvt Ltd's transfer pricing dispute, citing unexplained delays of 609 days and 457 days while keeping the questions of law open.
A Division Bench of Justices J.B. Pardiwala and K. Vinod Chandran dismissed the petitions on the ground of delay, finding no satisfactory explanation from the Revenue for the gross delays. The Court said:
“There is a gross delay of 609 days and 457 days respectively in filing the Special Leave Petitions which has not been satisfactorily explained by the Revenue. The Special Leave Petitions are, accordingly, dismissed on the ground of delay. Question of law is kept on.”
The petitions arose from the Delhi High Court's 5 August 2024 judgment dismissing the Revenue's appeal against the Income Tax Appellate Tribunal's (ITAT) 14 December 2020 order concerning Samsung India.
The Revenue had challenged the ITAT's findings on whether advertisement, marketing and promotion (AMP) expenditure constituted an international transaction, whether the Brightline Test could be applied, and whether AMP expenditure could be separately benchmarked where the Transactional Net Margin Method (TNMM) was applied at the segmental or entity level.
The Revenue had also challenged the selection of comparable companies for transfer pricing purposes, including the exclusion of OTS E-Solutions Pvt Ltd and the inclusion of Redington India Ltd and HCL Infosystems Ltd.
The Delhi High Court upheld the ITAT's conclusions on the AMP-related issues, relying on its earlier judgment in Sony Ericsson Mobile Communications India Pvt. Ltd. v. Commissioner of Income Tax. It also upheld the ITAT's findings on the comparable companies. It held that the Revenue's appeal did not raise any substantial question of law and dismissed it.
Now, the Supreme Court has dismissed the Revenue's SLPs on limitation, while expressly keeping the questions of law open.
For Petitioner: Raghavendra P.shankar, A.S.G., Sudarshan Lamba, AOR, Santosh Kumar
For Respondent: Himanshu Shekhar Sinha, Prashant Meharchandani, Jainendra Singh Kataria, Kanika Jain, Trilegal Advocates On Record, AOR