AMP Expenses Not Separate International Transaction: Delhi HC Upholds ITAT Decision

The Delhi High Court upheld ITAT's decision that AMP (Advertising, Marketing and Promotion) expenses don't constitute separate international transactions requiring transfer pricing adjustment. Justice Manmohan ruled that routine AMP spending lacks the economic significance to qualify as an international transaction under Section 92B. The case involved a ₹48 crore addition where the TPO argued excessive brand-building benefited foreign affiliates. The judgment clarifies that only extraordinary AMP expenditures creating marketing intangibles may require benchmarking. This precedent benefits multinationals facing similar transfer pricing disputes on routine marketing costs. The court affirmed that tax authorities must demonstrate clear value transfer to associated enterprises before making such adjustments. The ruling brings certainty to an area of frequent TP litigation while preserving the department's right to examine exceptional brand-building expenditures case-by-case.