Case Law Details
Law empowers Transfer Pricing Officer to determine the arm’s length price of only ‘referred’ international transactions. Non-referred international transactions fall outside the TPO’s jurisdiction
The Delhi Bench of the Income-tax Appellate Tribunal (the Tribunal) in the case of M/s. Amadeus India Pvt Ltd Vs. ACIT, Range-I, New Delhi (ITA No. 5203/Del/2010) held that the role of Transfer Pricing Officer (TPO) is limited to the determination of arm’s length price in relation to the international transaction(s) referred to him by the Assessing Officer (AO). The TPO, suo motto, cannot take cognizance of any other international transaction not referred to him by the TPO.
Facts of the case
• The taxpayer is engaged in the business of providing data processing and related services including software access to the subscribers of the Amadeus products. Transaction Net Margin Method (TNMM) with NCP margin as the Profit Level Indicator (PLI) was applied for determining the Arm’s Length Price (ALP) of international transactions.
• The AO, with due approval of Commissioner of Income Tax, referred the case to the TPO for determination of ALP of the international transactions mentioned in Form No. 3CEB.
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