DMD Advocates Successfully Represents Tetra Pak India In Bombay High Court On Transfer Pricing Aggregation Approach
DMD Advocates Successfully Represents Tetra Pak India in Bombay High Court on Transfer Pricing Aggregation Approach
The leading law firm in India, DMD Advocates represented Tetra Pak India Pvt Ltd in a significant transfer pricing matter before the Bombay High Court, securing a favorable outcome that upholds the aggregation approach for benchmarking international transactions. The case highlights the firm’s expertise in complex corporate tax and transfer pricing disputes.
Background
Tetra Pak India Pvt Ltd (the "Assessee"), engaged in the manufacture and sale of packaging machines, systems, and straws, adopted an aggregation approach for benchmarking 13 categories of international transactions with its associated enterprises under the Transactional Net Margin Method ("TNMM"). The Transfer Pricing Officer ("TPO") proposed adjustments in respect of these transactions and challenged this methodology. The Assessee's position was accepted by the Dispute Resolution Panel ("DRP") and affirmed by the Income Tax Appellate Tribunal ("ITAT"), following which the Revenue appealed to the Bombay High Court. The matter was heard by a Division Bench comprising Justice Suman Shyam and Justice Shyam C. Chandak.
High Court Decision
The Bombay High Court dismissed the Revenue's appeal. The Court noted that the DRP had specifically held that the Assessee's aggregation approach should not be rejected and that the transfer pricing analysis ought to be conducted on that basis, a finding affirmed by the ITAT. Placing reliance on the ruling of the Bombay High Court in the case of Cummins India Ltd (which was upheld by the Hon'ble Supreme Court), the Court held that no substantial question of law arose on the facts warranting its interference and dismissed the appeal as devoid of merit.
Legal Representation
The DMD Advocates, led by Fereshte Sethna (Founder & Managing Partner, Mumbai) and Mrunal Parekh (Partner), appeared for Tetra Pak India Pvt Ltd.
Conclusion
This judgment reinforces the validity of the aggregation approach for benchmarking international transactions under TNMM, providing clarity and certainty for multinational enterprises in India regarding transfer pricing compliance. It underscores DMD Advocates’ continued commitment to delivering robust representation in complex corporate and tax litigation matters.
DMD Advocates is a leading full-service law firm in India with a focus on solutions through a unique holistic approach that blends its expertise and decades of experience in core practice areas – litigation & arbitration, taxation, corporate, regulatory, competition, and intellectual property rights. We have a team of more than 100 lawyers, including 30 partners/directors, and a pan-India presence, with principal offices in New Delhi & Mumbai and associate offices in Ahmedabad, Bangalore, Chennai, Cochin, Kolkata, and Bhubaneswar.
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