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Transfer Pricing alerts

Insight with information

Deloitte's continuous alerts keep you updated with the latest that's happening. Watch this space regularly.

TP/16/2014 Tribunal strikes down arbitrary lifting of corporate veil by TPO
TP/15/2014 Reimbursements of Costs require arm’s length price determination.
TP/14/2014 Price Publications of independent organizations - acceptable CUP
TP/13/2014 Adjustment for difference in capacity utilisation allowed
TP/12/2014 No TP adjustment if taxpayer earns profit less than arm’s length
profit resulting in a lower tax holiday claim
TP/11/2014 India successfully concludes first batch of Advance Pricing
Agreements (APAs)
TP/10/2014 Corporate guarantees with no impact on profits, income, losses
or assets of a guarantor not considered international transactions;
Share application cannot be recharacterised as interest free loan
TP/9/2014 Special Bench strikes down sub-classification of ITES into BPO and KPO, upholds strict functional comparability; negates outright rejection of high margin companies
TP/8/2014 Royalty on sales to associated enterprises allowed
TP/7/2014 Reimbursement by taxpayer of advertisement expenditure relating to export sales allowed
TP/6/2014 Internal CUP with adjustments preferred over TNMM
TP/5/2014 Use of cash profit or depreciation adjustment under TNMM requires detailed analysis and cogent reasons
TP/4/2014 Role of Transfer Pricing Officer limited to determining the arm’s length price
TP/3/2014 Profit Split Method, the most appropriate method for freight forwarding services
TP/2/2014 Expenses in connection with sales which do not lead to brand promotion cannot be brought in the ambit of Advertising, Marketing and Promotion expenses
TP/1/2014 Interest to be charged on delayed payments from associated enterprises
TP/33/2013 Non-reporting of segmental results in the audited financial accounts cannot be a basis for rejecting segmental results prepared for transfer pricing purposes
TP/32/2013 Jurisdictional requirement for applicability of TP provisions to be established, if raised by a taxpayer, before considering the issue of valuation
TP/31/2013 Tribunal upholds profit attribution to India Bank Branch on borrowers’ credibility analysis
TP/30/2013 While commercial expediency is not relevant in making transfer pricing adjustments, a proper comparability analysis is imperative
TP/29/2013 CBDT issues final Safe Harbour Rules
TP/28/2013 No Compensation is required for non-routine AMP expenses if profits earned are more than comparable companies performing similar intensity of functions
TP/27/2013 Price and not margin is relevant in application of CUP Method, Transactions made with AEs are not Internal CUP, Third Member decision overrides division bench
TP/25/2013 Companies having low turnover / persistent loss/ diminishing revenues are not good comparables; companies having super normal profits to be considered, unless functionally different
TP/24/2013 Transfer Pricing adjustment restricted to international transactions. No penalty u/s 271(1)(c) when taxpayer furnishes all details in its return of income
TP/23/2013 CBDT issues final Safe Harbour Rules
TP/22/2013 CBDT issues draft Safe Harbour Rules – would it meet the objectives?
TP/21/2013 Companies having low turnover / persistent loss/ diminishing revenues are not good comparables; companies having super normal profits to be considered, unless functionally different.
TP/20/2013 Transfer Pricing adjustment restricted to international transactions. No penalty u/s 271(1)(c) when taxpayer furnishes all details in its return of income.
TP/19/2013 Companies involved in software product development, or assuming all risks leading to higher profits are not comparable with captive software service providers. Marketing support services providers are not comparable with commission agents.
TP/18/2013 The CBDT has recently notified the Income-tax (Sixth Amendment) Rules, 2013, making Rules and Accountant’s Report in line with the changes made to the Indian Transfer Pricing Regulations by the Finance Act, 2012.
TP/17/2013 Necessary adjustments should be carried out to take into account impact of abnormal fluctuations in foreign exchange while determining arm’s length price. Rule on admission of additional evidence explained.
TP/16/2013 CBDT issues Guidance on Advance Pricing Agreements with FAQs
TP/15/2013 Arm’s Length Price of Royalty for brand payments cannot be considered as NIL in absence of similar brand royalty payments by Group companies
TP/14/2013 As LIBOR is an average of rates the benefit of plus / minus 5% is available when used as comparable uncontrolled price
TP/13/2013 Special Bench is constituted by Delhi Tribunal on applicability of the turnover filter
TP/12/2013 Central Government notifies amended tolerance band for transfer pricing
TP/11/2013 CBDT issues two important circulars on Transfer Pricing applicable to Research and Development activities
TP/10/2013 Extra-ordinary expenses should be excluded while computing margins of the tested party; consolidated financial statements not preferred to compute margins of comparable companies; extreme profits / losses cannot be a sole criteria for rejection of comparables; concept of economies of scale does not apply to service industries
TP/09/2013 Interest rate on lending in foreign currency to foreign subsidiaries, domestic prime lending rate would have no applicability and the international rate fixed being LIBOR should be considered as the benchmark rate.
TP/08/2013 Indenting /commission transactions cannot be compared to purchase-and-sale trading transactions and internal comparable is preferable over external comparable
TP/07/2013 Advertising, Marketing and Promotion expenses upheld to be an international transaction, warranting the tax payer to be compensated on arm’s length principle by applying the Bright Line Test
TP/06/2013 Transactions between two domestic related parties cannot be covered under the extended definition of “International Transaction”
TP/05/2013 Irrespective of the fact whether the assessee is a contract manufacturer or full-fledged manufacturer, royalty paid for utilizing technical knowhow, should be considered as wholly and exclusively for the purpose of business and be allowed.
TP/04/2013 Sharing of net revenues in equal proportion is justified in case of similarities between the functional and risk profiles of the Assessee and the associated enterprises.
TP/03/2013 Shares in a company transferred by an enterprise alongwith a third party to an Associated enterprise under a single agreement would be considered as controlled transactions; Further, discounted cash flow method is an appropriate method for determining the arm’s length price of such a transaction.
TP/02/2013 Taxpayer’s business model cannot be rejected merely on assumptions, presumptions, inadequate analysis and without concrete evidence that the taxpayer is shifting profits to it Associated Enterprise.
TP/01/2013 Export incentive cannot, but the rebate received can be reduced from cost of goods sold for computing gross profit margin for determining the arm’s length price.