Comments on : Transfer Pricing - Specified Domestic Transaction

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Jinesh Bhagdev

Wrote on 13 July 2012

Thanks Sunil for Highlighting this Fact. It is infact current Financial Year i.e. Applicable for F.Y. 2012-13 A.Y 2013-14. Apologies for the error in the last paragraph.

Sunil Bhageria

Wrote on 13 July 2012

What is the applicabiltiy date? is it FY 2013-14 or AY 2013-14 .Pl calrify.Because as per Taxman ready Reconer it is applicable for AY 2013-14 means current FY

sachin

Wrote on 25 June 2012

Thanks for sharing ..............

Jinesh Bhagdev

Wrote on 25 June 2012

Section 92(1) read with section 92(2).. 40A(2)to my understanding cannot be read in isolation.. one side of the transactions is at ALP not necessarily rendered other side at ALP..

Gaurav Garg

Wrote on 25 June 2012

But under which section?

I agree.. It would not apply to the company who has not paid to related parties.. But it would apply to the company who has granted the interest free loan or given corporate guarantee for not entering into a transaction at ALP.

Gaurav Garg

Wrote on 25 June 2012

Section 40A(2)(b) is applicable on expenses payable or paid to the related parties. Transaction wherein the taxpayer has not paid any expense to related party and FMV or TP provisions should not apply.

Jinesh Bhagdev

Wrote on 25 June 2012

It will apply to the companies who has given interest free loans or corporate guarantee wherein the TPO will expect the giving company to charge interest or corporate guarantee in the same manner that they are expecting in international transactions..

Gaurav Garg

Wrote on 25 June 2012

Hi Jinesh, Can you please elaborate that how it would be applicable on interest free loan or corporate guarantee with no charges?

Jinesh Bhagdev

Wrote on 25 June 2012

It will impact group cos. who share services and as such the group will have to comply with the TPR. The mark-up on shared services may be determined based on cost-benefit analysis.