Urgent- transfer pricing applicable or not

sachin (Student CA Final ) (26 Points)

06 April 2015  

Dear Respected Members my queries is like this-

1. There are 2 PVt. Ltd. Companies, one of the director is common ,the compainies are closely held companies, and the directors are brother also.

2. Both the co. are profit making companies and are taxable at the same rate of tax.

3. Non of the co. is availing any exemptions, benifits or tax holidays.

4. One co.( say A)  has sold some material to the other  (say B) co. , who has used the same for manufacturing .The total transaction is more than Rs. 500 lacs/ 5 crore.

MY Questions are-

1. Whether domestic transfer pricing is applicable to these companies or not?

2..If yes then on which co.? 

3. If no then why not applicable ?