Case Law Details
Court: Bangalore bench of the Income Tax Appellate Tribunal
Citation: Logix Micro Systems Ltd. Vs. ACIT
Brief: The Bangalore tribunal has confirmed the inclusion of imputing interest on inter- company receivables as part of the transfer pricing assessment scrutiny and held that the arm’s length principle is equally applicable to interest on receivables under the India transfer pricing regulations.
Facts of the case
• M/s Logix Micro Systems Ltd (the taxpayer) is engaged in the provision of software development and consultancy services to its Associated Enterprise (AE) in USA. During AY 2004- 05 (FY 2003- 04) the taxpayer reported international transactions in the category of purchase of capital equipment, purchase of computer software, provision for software development and consultancy services.
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