No capital gains in a business reorganization if consideration not determinable. Transfer pricing law does not apply if there is no income

AAR Ruling – transfer of shares of Indian Subsidiaries of an American company without consideration in a scheme approved for bankruptcy proceedings in an American Court would not attract capital gains and consequently, transfer pricing provisions cannot be applied in such transactions [A.A.R. No. 788 of 2008 – Dana Corporation] The applicant, a USA company, held shares in an Indian company. As part of a bankruptcy reorganization process, the shares in the Indian company together with other non-Indian assets & liabilities were transferred to other USA companies. The liabilities...