ALP judiciary-2

No TP adjustment for loan & advance for investment in equity or for benefit in business

Lambda Therapeutic Research Ltd. Vs D.C.I.T (ITAT Ahmedabad)

Lambda Therapeutic Research Ltd. Vs DCIT (ITAT Ahmedabad) We find that the assessee has not demonstrated any benefit derived from its associated enterprises namely Lambda USA whereas it has advanced interest free loan of EURO 49,999/-. Thus, the question arises whether there is a need to make any adjustment on account of notional interest...

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ALP determinable for international transaction of Corporate Guarantee

Sami – Sabinsa Group Ltd. Vs DCIT (ITAT Bangalore)

ALP of corporate guarantee has to be determined as it falls within scope and ambit of an international transaction after retrospective amendment to section 92B and 0.5% corporate guarantee is held to be appropriate....

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CCD cannot be treated as ECB/loan for ALP determination

Praxair India Private Limited Vs DCIT (ITAT Bangalore)

The TPO and DRP erred in treating CCDs as ECBs and benchmarked the interest rate against LIBOR rate. The CCDs is a hybrid instrument and cannot be per se treated as ECB / loan....

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No further income attributable to a PE in India, if PE been remunerated at ALP

Mobileum Inc Vs DCIT (ITAT Mumbai)

Mobileum Inc Vs DCIT (ITAT Mumbai) since transactions between the assessee and its AE have been found at arm’s length prices no further income chargeable to tax in India can be said to be attributable for the PE of the assessee. FULL TEXT OF THE ORDER OF ITAT MUMBAI This appeal by the Assessee is […]...

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ITAT upheld determination of ALP as nil for duplicative services

DCIT Vs Teradata India Pvt. Ltd. (ITAT Delhi)

The issue under consideration is whether the TPO is correct in considering subvention fee in the BPO segment instead of distribution segment?...

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Company with huge asset base cannot be compared with company having insignificant assets Pvt. Ltd. Vs DCIT (ITAT Delhi)

If a company is having huge asset base, brand value, goodwill and presence in global market with significant R & D, then it cannot be compared with a company which is purely captive service provider in ITeS/BPO, having low risk and insignificant assets....

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Associated Enterprises of assessee cannot be taken as comparable for determining ALP as per CUP method

Gemstone Glass Pvt. Ltd Vs Joint Commissioner of Income Tax (ITAT Ahmedabad)

The ITAT Ahmedabad in the case of Gemstone Glass Pvt. Ltd vs. JCIT held that when an associated enterprise is taken as comparable then CUP method cannot be adopted for determining Arm Length Price irrespective of the fact that the associated enterprise taken as comparable is resident or non-resident....

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Functionally dissimilar company cannot be considered as comparable for computation of ALP

M/s. AT & T Global Business Services India Pvt.Ltd. Vs ITO (ITAT Bangalore)

In case of M/s. AT & T Global Business Services India Pvt.Ltd. VS. ITO , assessee-company, engaged in business of software development and providing application services to its AE. TPO on basis of mean margin earned by his own set of comparables...

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If there is International transaction, Arm’s Length Price would be decided using international commercial principle.

CIT Vs M/s Cotton Naturals (I) Pvt. Ltd. (Delhi High Court)

Assessee had given the loan to the associate enterprise in U.S.D. and in such a situation when the transaction was in foreign currency, and the transaction was an international transactions, then the transaction would have to be looked upon by applying the commercial principles in regard to international transactions....

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June 2022