‘No Substantial Question of Law’: Delhi HC Rejects Revenue's Challenge in Tupperware India Transfer Pricing Case [Read Order]
The Court observed that legal and factual position had already been settled in preceding years
The Delhi High Court has dismissed two appeals filed by the Principal Commissioner of Income Tax–7, Delhi, challenging a common order of the Income Tax Appellate Tribunal concerning the financials of Tupperware India for the Assessment Years 2015-16 and 2016-17. The Court held that the issues raised were already settled in earlier years in favour of Tupperware , leaving no substantial question of law for adjudication presently.
The dispute concerns the benchmarking of royalty payments under the transfer pricing framework. The Revenue placed on record the order passed by this Court in Pr Commissioner of Income Tax, Delhi-7 v. Tupperware India Private Limited (2023) where it was argued that the Tribunal had erred in accepting the assessee’s chosen comparables and rejected the Transfer Pricing Officer’s findings. The Revenue further maintained that the Transfer Pricing Officer’s reasoning ought to have been upheld.
The assessee, on the other hand, had contended that the comparables selected were from the same industry, involving identical categories of kitchenware and home-furnishing products, and belonged to the same geographical region as the agreements considered by the Transfer Pricing Officer in his remand report.
In the above case, it was argued that the Tribunal had correctly applied the Comparable Uncontrolled Price method, and the findings relating to comparability were purely factual, requiring no interference. The assessee also emphasised that the Tribunal had followed its decisions in earlier years, which had already been affirmed by the High Court.
The Bench, comprising Justice V. Kameswar Rao and Justice Mini Pushkarna, noted that the Revenue had itself conceded that identical issues had been determined against it in Assessment Years 2013-14 and 2014-15.
The Court reviewed its earlier rulings upholding the Tribunal’s findings where it was observed that the Revenue had failed to demonstrate any perversity or distinguishing feature warranting a fresh examination.
Since the legal and factual position had already been settled in previous years and no new question of law arose, the High Court dismissed the appeals relating to AY 2015-16 and AY 2016-17, consequently affirming the Tribunal’s conclusions in favour of Tupperware India Pvt. Ltd.
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