Newly introduced section 92e
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
02 November 2013
SIR,
COMPANY X PVT LIMITED HAVING 2 DIRECTORS.BOTH THE DIRECTORS ARE PROPRIETOR IN 2 DIFFERENT PROPRIETORSHIP FIRM A AND B .
X PVT LIMITED PURCHASES GOODS FROM A RS.3.00 CRORE AND FROM B RS.3.00 CRORE.
THE AGGREGATE VALUE COMES TO RS. 6.00 CRORE WHICH EXCEEDS RS. 5.00 CRORE.
MY QUESTION IS LIMIT OF RS. 5.00 CRORE WILL BE ASCERTAINED SEPARATELY OR CLUBBED TOGETHER?
PLEASE GUIDE ME
COMPANY X PVT LIMITED HAVING 2 DIRECTORS.BOTH THE DIRECTORS ARE PROPRIETOR IN 2 DIFFERENT PROPRIETORSHIP FIRM A AND B .
X PVT LIMITED PURCHASES GOODS FROM A RS.3.00 CRORE AND FROM B RS.3.00 CRORE.
THE AGGREGATE VALUE COMES TO RS. 6.00 CRORE WHICH EXCEEDS RS. 5.00 CRORE.
MY QUESTION IS LIMIT OF RS. 5.00 CRORE WILL BE ASCERTAINED SEPARATELY OR CLUBBED TOGETHER?
PLEASE GUIDE ME
02 November 2013
they will be clubbed. domestic transfer pricing regulations shall apply to this entity
Querist : Anonymous
Querist :
Anonymous
(Querist)
06 November 2013
SIR,
WE HAVE ALREADY FILED FORM NO 3CA AND 3CD AND ITR FOR A.Y.2013-14 WITHOUT SUBMITTING FORM 3CEB. CAN IT BE REVISED ? IF YES, THEN WHAT WILL BE THE DOMESTIC PRICE OF RS. 6.00 CRORES
WE HAVE ALREADY FILED FORM NO 3CA AND 3CD AND ITR FOR A.Y.2013-14 WITHOUT SUBMITTING FORM 3CEB. CAN IT BE REVISED ? IF YES, THEN WHAT WILL BE THE DOMESTIC PRICE OF RS. 6.00 CRORES
04 August 2024
Let's address your questions step by step:
### 1. Application of Section 92E to Company X Pvt Limited:
Section 92E of the Income Tax Act, 1961 pertains to maintenance and filing of transfer pricing documentation in respect of international transactions and specified domestic transactions. In your case:
- **Transactions Involved:** Company X Pvt Limited (X Pvt Ltd) has purchased goods from two proprietorship firms where both directors are proprietors:
- From Firm A: Rs. 3.00 crore
- From Firm B: Rs. 3.00 crore
- Total aggregate value: Rs. 6.00 crore
- **Threshold for Compliance:** The threshold for applicability of transfer pricing documentation requirements under Section 92E is when the aggregate value of specified domestic transactions exceeds Rs. 5.00 crore during the financial year.
### Treatment of Transactions:
- **Separate or Clubbed Basis:** Normally, the transactions with each related party (in this case, the two proprietorship firms) are evaluated separately to determine if they exceed the threshold. Since both transactions are with different entities (Firm A and Firm B), they are considered separately for the purpose of determining applicability under Section 92E.
### 2. Filing Requirements and Revision of Form 3CEB:
- **Form 3CEB Requirement:** Form 3CEB is required to be filed along with Form 3CA and Form 3CD if the aggregate value of specified domestic transactions exceeds Rs. 5.00 crore. In your case, since the aggregate value is Rs. 6.00 crore, Form 3CEB would be required.
- **Revision of ITR for A.Y. 2013-14:** Yes, if Form 3CEB was not filed earlier and it should have been, you may revise the income tax return (ITR) for Assessment Year (A.Y.) 2013-14 to include Form 3CEB.
### Domestic Transfer Pricing Computation:
- **Domestic Price for Rs. 6.00 Crores:** When determining the domestic transfer price for the transactions totaling Rs. 6.00 crore, you need to ascertain the arm's length price (ALP). This involves comparing the prices charged in these transactions with prices charged in comparable uncontrolled transactions under the methods prescribed in the transfer pricing regulations.
### Conclusion:
- Transactions with each related party (Firm A and Firm B) are evaluated separately under Section 92E.
- If Form 3CEB was not filed earlier but should have been, you can revise the ITR for A.Y. 2013-14 to include Form 3CEB.
- The domestic transfer pricing analysis for the Rs. 6.00 crore transactions involves determining the arm's length price based on the applicable transfer pricing methods.
For precise compliance and to ensure correctness in your specific case, it is advisable to consult with a qualified chartered accountant or tax advisor who can assist you with revising the ITR and complying with the transfer pricing requirements effectively.
### 1. Application of Section 92E to Company X Pvt Limited:
Section 92E of the Income Tax Act, 1961 pertains to maintenance and filing of transfer pricing documentation in respect of international transactions and specified domestic transactions. In your case:
- **Transactions Involved:** Company X Pvt Limited (X Pvt Ltd) has purchased goods from two proprietorship firms where both directors are proprietors:
- From Firm A: Rs. 3.00 crore
- From Firm B: Rs. 3.00 crore
- Total aggregate value: Rs. 6.00 crore
- **Threshold for Compliance:** The threshold for applicability of transfer pricing documentation requirements under Section 92E is when the aggregate value of specified domestic transactions exceeds Rs. 5.00 crore during the financial year.
### Treatment of Transactions:
- **Separate or Clubbed Basis:** Normally, the transactions with each related party (in this case, the two proprietorship firms) are evaluated separately to determine if they exceed the threshold. Since both transactions are with different entities (Firm A and Firm B), they are considered separately for the purpose of determining applicability under Section 92E.
### 2. Filing Requirements and Revision of Form 3CEB:
- **Form 3CEB Requirement:** Form 3CEB is required to be filed along with Form 3CA and Form 3CD if the aggregate value of specified domestic transactions exceeds Rs. 5.00 crore. In your case, since the aggregate value is Rs. 6.00 crore, Form 3CEB would be required.
- **Revision of ITR for A.Y. 2013-14:** Yes, if Form 3CEB was not filed earlier and it should have been, you may revise the income tax return (ITR) for Assessment Year (A.Y.) 2013-14 to include Form 3CEB.
### Domestic Transfer Pricing Computation:
- **Domestic Price for Rs. 6.00 Crores:** When determining the domestic transfer price for the transactions totaling Rs. 6.00 crore, you need to ascertain the arm's length price (ALP). This involves comparing the prices charged in these transactions with prices charged in comparable uncontrolled transactions under the methods prescribed in the transfer pricing regulations.
### Conclusion:
- Transactions with each related party (Firm A and Firm B) are evaluated separately under Section 92E.
- If Form 3CEB was not filed earlier but should have been, you can revise the ITR for A.Y. 2013-14 to include Form 3CEB.
- The domestic transfer pricing analysis for the Rs. 6.00 crore transactions involves determining the arm's length price based on the applicable transfer pricing methods.
For precise compliance and to ensure correctness in your specific case, it is advisable to consult with a qualified chartered accountant or tax advisor who can assist you with revising the ITR and complying with the transfer pricing requirements effectively.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- STCG....................................................
- Section 54F - Exemption on LTCG in 2026 for HP purchased in 2023
- AMOUNT RECEIVED UNDER COMPULOSRY ACQUISITION OF AGRICULTURAL LAND
- TAN for Partnership
- Treatment of Pension ?annuity returns on PMVY
- CA IPCC Registeration in 2012, Is my registration Active or Expired
- TDS related Query_Liquidated Damages
- Free lancer income
- Last year TDS Claim
- AY 26-27 ITR-4 FILING U/S 44-ADA
- Soyabean hsn code and gst rate
- NON- SUBMISSION OF LLP FORM 3
- Gst invoice numbering and delivery challan numbering
- Standard Deduction claim for EPFO Pension and ICICI Prudential Life Annuity
- Small dealers gst returns filing
- Sales amount in Gstr1
- CG after sale of flat
- E Commerce GSTR1 & 3B how to file
- Nomination of Bank for refund in itr 2
- GST Cancellation without jurisdiction
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
