Transfer Pricing

Curbing the Intangible Shenanigan – Hard to value Intangibles

Income Tax - Anurag Agrawal Introduction Over several decades and in step with the globalisation of the economy, intra group transactions have grown exponentially world-wide especially related to intangible assets. The word “intangible asset” is intended to address something which is not a physical asset or a financial asset, which is capable of b...

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International Perspective on Transfer Pricing Regime

Income Tax - In the aftermath of the second world war, the global trade has continued to develop and has resulted in globalization of trade. In the era of globalization, the fixed boundaries within which a firm used to operate have transcended and firms have integrated their operations around the world, taking advantage of cheap labour and technologic...

Read More

Secondary Adjustment – Section 92CE & Rule 10CB

Income Tax - Transfer pricing provisions seek to ensure that there is fair and equitable allocation of taxable profits amongst the tax jurisdictions. In cases where the underlying transaction is held not to be at arm’s length, a primary adjustment is made to align the transfer price with the arm’s length price (ALP) which is known as primary [&hel...

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Transfer Pricing – The Expanded Version

Income Tax - The Finance Act, 2012 expanded the scope of the term International Transaction thereby giving the clarity as to what the legislature meant or rather deemed fit to be International Transaction and consequential amendments were also made to other connected sections of Transfer Pricing in the Income-tax Act, 1961. ...

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Domestic Transfer Pricing Provisions in India

Income Tax - After the grand success of International Transfer pricing, through which huge transfer pricing orders slapped on companies with cross-border operations in the financial year 2011-12, Hon’ble Finance Minister has cast his net wider and deeper for the next one by including Specified Domestic Transactions in the purview of Transfer Pricing...

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Introduce threshold limit of Rs. 25 crore for SDT documentation requirements: ICAI

Income Tax - The Finance Act 2012 has introduced DTP in spite of existing provisions under the Act which empower the Assessing Officer (AO) to re-compute the income of assessees availing profit-linked deductions if there are transactions with related parties or other undertakings of the same assessee...

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Acceptance of Transfer Pricing MAP and bilateral APA – Reg.

Income Tax - Clarification of India’s position on the acceptance of MAP and bilateral APA in cases of countries where Article 9(2) of OECD Model Tax Commentary is absent...

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Guidance Note on Transfer Pricing Report U/s. 92E of Income Tax Act, 1961

Income Tax - ICAI has released the 6th Edition (November 2017) of the Guidance Note on Report Under Section 92E of the Income Tax Act, 1961 (Transfer Pricing). This Guidance Note was previously revised in February, 2013 , August 2013 and October 2016. The ICAI has revised Guidance note on Report under Section 92E of the Income Tax […]...

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Fighting Tax Crime: The Ten Global Principles

Income Tax - This report sets out the 10 essential principles for effectively fighting tax crimes. It covers the legal, institutional, administrative, and operational aspects necessary for putting in place an efficient system for fighting tax crimes and other financial crimes. It draws on the insights and experience of jurisdictions around the world. ...

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Effective Inter-Agency Co-Operation in Fighting Tax Crimes and Other Financial Crimes (Third Edition)

Income Tax - This report describes the current position in 51 countries as to the law and practice for domestic inter-agency co-operation in fighting tax crimes and other financial crimes including, for the first time, co-operation with authorities responsible for the investigation and prosecution of corruption. It identifies successful practices base...

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Categorical finding of fact by ITAT cannot be challenged as a substantial question of law

PCIT Vs NVP Venture Capital India Pvt. Ltd (Bombay High Court) - ITAT came to a finding that Motilal Oswal Investments Advisory Pvt. Ltd. was not a concern which could be included in the list of comparable companies. We do not think that these findings of fact are in any way perverse or vitiated by any error apparent on the face of the record which, in turn, woul...

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Transfer Pricing- AMP expenses-Brand promotion vis-a-vis product promotion

Nivea India Pvt. Ltd Vs ACIT (ITAT Mumbai) - Nivea India Pvt. Ltd Vs ACIT (ITAT Mumbai)  TPO had not brought on record the fact that AMP expenses incurred by assessee were not for its own business. The sole basis on which adjustment, under the head AMP expenditure, was made was that expenditure incurred by assessee was significantly higher th...

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TP: Mere dispute on exclusion / inclusion of comparables to determine ALP not necessarily give rise to substantial questions of law

Pr. CIT Vs M/s TIBCO Software (India) Pvt Ltd (Bombay High Court) - Pr. CIT Vs M/s TIBCO Software (India) Pvt Ltd (Bombay High Court) Any inclusion or exclusion of comparables per se cannot be treated as a question of law unless it is demonstrated to the Court that the Tribunal or any other lower authority took into account irrelevant consideration or excluded relev...

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TPO cannot conclude presence of international transaction u/s 92B merely surmises

Moet Hennessy India Pvt Ltd Vs ACIT (ITAT Delhi) - Moet Hennessy India Pvt Ltd Vs ACIT (ITAT Delhi)  In the present case, no new facts have emerged and all the facts brought to record, during the course of the assessment proceedings, do not indicate legally sustainable basis for coming to the conclusion that there was an internal transaction in res...

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Comparable with functional and risk profiles difference cannot be selected

M/s. Mckinsey Knowledge Centre India pvt. Ltd. Vs Pr. Commissioner of income tax (Delhi High Court) - M/s. Mckinsey Knowledge Centre India pvt. Ltd. Vs PCIT (Delhi High Court) The revenue urged that a stringent application of the comparability test was unnecessary as was also provisioned in Chapter-6 of United Nations Practical Manual on Transfer Pricing, Edition 2013, and some flexibility in conduc...

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Draft Amendment To Transfer Pricing Rule 10CB related to Computation of Interest Income U/s 92CE

F. No. 370142/12/2017-TPL - (19/06/2018) - Amendment in Rule 10CB of Income-tax Rules, 1962 in respect of computation of interest income pursuant to secondary adjustment made under section 92CE of Income-tax Act, 1961 – Comments and suggestions ...

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Draft notification proposing amendment to rule 44E, Form 34C, 34D & 34DA

F.No.370142/34/2016-TPL (Part) - (10/04/2018) - Draft notification proposing an amendment to rule 44E, Form 34C, 34D and 34DA as per BEPS action item 5, for improving transparency in relation to tax rulings– comments and suggestions...

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CBDT notifies rules for Country-By-Country Report and Master File rules

Notification No. 92/2017-Income Tax [S.O. 3497(E)] - (31/10/2017) - Information and documents to be kept and maintained under proviso to sub-section (I) of section 92D and to be furnished in terms of sub-section (4) of section 92D. 10DA. (1) Every person, being a constituent entity of an international group shall,-...

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Country-by-Country reporting & furnishing of master file- Draft TP rules

F. No. 370142/25/2017-TPL - (06/10/2017) - It is proposed to insert rulac 10DA, 10DB and form nos. 3CEBA to 3CEBE in the Income-tax Rules, 1962 (`the Rules'), laying down the guidelines for maintaining and furnishing of transfer pricing documentation in the Master File and Country-by-Country report. In this regard, the following guidelines a...

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CBDT Amends Form No. 3CEFA related to Application for Opting for Safe Harbour

Notification No. 62/2017-Income Tax [G.S.R. 891(E)] - (18/07/2017) - These rules may be called the Income-tax (21st Amendment) Rules, 2017.They shall come into force and shall be deemed to have come into force from the 1st day of April, 2017. In the Income-tax Rules, 1962, in Appendix II, in Form No. 3CEFA, in paragraph 2, under the heading Eligible International Tra...

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Recent Posts in "Transfer Pricing"

Curbing the Intangible Shenanigan – Hard to value Intangibles

Anurag Agrawal Introduction Over several decades and in step with the globalisation of the economy, intra group transactions have grown exponentially world-wide especially related to intangible assets. The word “intangible asset” is intended to address something which is not a physical asset or a financial asset, which is capable of b...

Read More
Posted Under: Income Tax |

Categorical finding of fact by ITAT cannot be challenged as a substantial question of law

PCIT Vs NVP Venture Capital India Pvt. Ltd (Bombay High Court)

ITAT came to a finding that Motilal Oswal Investments Advisory Pvt. Ltd. was not a concern which could be included in the list of comparable companies. We do not think that these findings of fact are in any way perverse or vitiated by any error apparent on the face of the record which, in turn, would give rise to any substantial question ...

Read More

International Perspective on Transfer Pricing Regime

In the aftermath of the second world war, the global trade has continued to develop and has resulted in globalization of trade. In the era of globalization, the fixed boundaries within which a firm used to operate have transcended and firms have integrated their operations around the world, taking advantage of cheap labour and technologic...

Read More
Posted Under: Income Tax |

Secondary Adjustment – Section 92CE & Rule 10CB

Transfer pricing provisions seek to ensure that there is fair and equitable allocation of taxable profits amongst the tax jurisdictions. In cases where the underlying transaction is held not to be at arm’s length, a primary adjustment is made to align the transfer price with the arm’s length price (ALP) which is known as primary [&hel...

Read More
Posted Under: Income Tax |

Transfer Pricing- AMP expenses-Brand promotion vis-a-vis product promotion

Nivea India Pvt. Ltd Vs ACIT (ITAT Mumbai)

Nivea India Pvt. Ltd Vs ACIT (ITAT Mumbai)  TPO had not brought on record the fact that AMP expenses incurred by assessee were not for its own business. The sole basis on which adjustment, under the head AMP expenditure, was made was that expenditure incurred by assessee was significantly higher than that of its comparable […]...

Read More

TP: Mere dispute on exclusion / inclusion of comparables to determine ALP not necessarily give rise to substantial questions of law

Pr. CIT Vs M/s TIBCO Software (India) Pvt Ltd (Bombay High Court)

Pr. CIT Vs M/s TIBCO Software (India) Pvt Ltd (Bombay High Court) Any inclusion or exclusion of comparables per se cannot be treated as a question of law unless it is demonstrated to the Court that the Tribunal or any other lower authority took into account irrelevant consideration or excluded relevant factors in the ALP […]...

Read More

Transfer Pricing – The Expanded Version

The Finance Act, 2012 expanded the scope of the term International Transaction thereby giving the clarity as to what the legislature meant or rather deemed fit to be International Transaction and consequential amendments were also made to other connected sections of Transfer Pricing in the Income-tax Act, 1961. ...

Read More
Posted Under: Income Tax |

Domestic Transfer Pricing Provisions in India

After the grand success of International Transfer pricing, through which huge transfer pricing orders slapped on companies with cross-border operations in the financial year 2011-12, Hon’ble Finance Minister has cast his net wider and deeper for the next one by including Specified Domestic Transactions in the purview of Transfer Pricing...

Read More
Posted Under: Income Tax |

TPO cannot conclude presence of international transaction u/s 92B merely surmises

Moet Hennessy India Pvt Ltd Vs ACIT (ITAT Delhi)

Moet Hennessy India Pvt Ltd Vs ACIT (ITAT Delhi)  In the present case, no new facts have emerged and all the facts brought to record, during the course of the assessment proceedings, do not indicate legally sustainable basis for coming to the conclusion that there was an internal transaction in respect of AMP expenses incurred […]...

Read More

Comparable with functional and risk profiles difference cannot be selected

M/s. Mckinsey Knowledge Centre India pvt. Ltd. Vs Pr. Commissioner of income tax (Delhi High Court)

M/s. Mckinsey Knowledge Centre India pvt. Ltd. Vs PCIT (Delhi High Court) The revenue urged that a stringent application of the comparability test was unnecessary as was also provisioned in Chapter-6 of United Nations Practical Manual on Transfer Pricing, Edition 2013, and some flexibility in conducting this comparison was urged to be all...

Read More

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