In a major victory for Flipkart, the Bengaluru-bench of Income Tax Appellate Tribunal (ITAT), on Wednesday rejected the Income Tax Department's appeal that re-characterization of Flipkart's hefty discounts as monopoly building capital expenses.

According to Taxsutra, the bench deleted Rs 1,000 crore addition made by the Income Tax Department against the loss declared by Flipkart in return of income.

The Income Tax Department has argued that Flipkart deliberately sold products at huge discounts to gain market share.

But Flipkart argued that Income Tax Department cannot dictate price at which products can be sold.