Income Tax : Chapter X of the Income Tax Act applies solely to transactions with Associated Enterprises (AEs), excluding non-AE transactions fr...
Income Tax : Uncover the concept of Double Taxation, its types - Juridical and Economic, and learn about relief mechanisms such as Unilateral a...
Income Tax : In Transfer pricing proceedings, corporate guarantee given by assessee to its foreign AE is always disputed by the department as a...
Income Tax : Insider trading, the bane of many Indians who were caught and jailed for their infamous acts is not new to USA. Even in 1700s, Mr....
Finance : This article attempts to dispel the doubts in the minds of such prospective NRI investors by addressing key issues pertaining to p...
Income Tax : India and USA have signed the Inter-Governmental Agreement (IGA) under FATCA in 2015. To enhance the effectiveness of information ...
Income Tax : The Central Board of Direct Taxes (CBDT) is in a fix over the application of one safe harbour rate to all sectors. A committee, fo...
CA, CS, CMA : The Finance Act, 2001 has introduced Sections 92 to 92F in the Income-Tax Act, 1961 with effect from Assessment Year 2002-2003 and...
Income Tax : Delhi HC rules Samsung India not a 'Permanent Establishment' of Samsung Korea. No tax liability under India-Korea DTAA for seconde...
Income Tax : Learn why a Section 90(1) notification is crucial for a DTAA's enforcement, as per the Supreme Court's landmark judgment in AO vs....
Income Tax : ITAT Delhi held that adoption of Comparable Uncontrolled Price (CUP) method for determining Arm’s Length Price (ALP) of the inte...
Income Tax : ITAT Chandigarh held that the amount of monthly assured return received till the time of possession of units is in nature of inter...
Income Tax : Whether the TPO was legally justified in holding that AMP expenditure was not an international transaction even though the asses...
By considering the potential loss on the long standing receivables as a genuine adjustment in the course of assessment, the Tribunal has reinforced the principles that the concept of TP cannot be that of an exact science and that constant application
With the advent of MNCs(Multi National Concerns) a trend has also been adopted by the MNCs to structure their investments and business strategy in such a way that profits are maximized in such jurisdictions where tax rates are low, which give rise to the emerging problem of transfer pricing all over the world.
The Central Board of Direct Taxes (CBDT) is in a fix over the application of one safe harbour rate to all sectors. A committee, formed last month to frame safe harbour rules as announced in the 2009-10 Budget to minimise transfer pricing disputes, has estimated that there is a huge difference in the margins of companies which would come under the ambit of safe harbour.
In the case of Schefenacker Motherson Ltd v. ITO, ITA No. 4459/DEL/07 for AY 2003-04 and schefenacker Motherson Ltd v. DCIT, ITA No.4460/DEL/07 for AY 2004-05, the Delhi Bench of the Income-tax Appellate Tribunal (the Tribunal), held that cash profit on sales “CP/Sales” or cash profit on total cost excluding depreciation “CP/TCdep”
The Delhi bench of the Income-tax Appellate Tribunal (the Tribunal), in the case of Oracle India (P) Ltd. V. ACIT (2009-TIOL-540-ITAT-DEL) (the taxpayer) held that section 40A(2) of the Income-tax Act, 1961 (the Act) overrides the provisions relating to computation of business income only and thus in relation to international transactions, the specific provisions embodied in Chapter X (section 92 – 92F) shall override the general provisions embodied in section 40A of the Act. Hence, once the Transfer Pricing Officer (TPO) accepts the arm’s length character of any international transaction, the Assessing Officer (AO) could not make an adjustment in relation to that transaction under section 40A(2) of the Act.
The Finance Act, 2001 has introduced Sections 92 to 92F in the Income-Tax Act, 1961 with effect from Assessment Year 2002-2003 and these provisions are commonly referred to as transfer pricing regulations. These provisions deal with the methods of computation of income from international transactions, the document to be maintained by the enterprises, certification by a Chartered Accountant and penalty for noncompliance thereof. The legal, financial and accounting aspects relating to transfer pricing are highly complex having global ramifications.
10.1 It is the common stand of both – the applicant and the Revenue, that the nature of income arising from the transfer of the applicant’s participating interest in Amguri block to the proposed partnership firm, shall be capital gains. Where they differ is regarding the mode of computation of that income. Whereas the applicant submits that sub-section( 3) of section 45 of the Act provides a particular mode
