Transfer Pricing 3CEB Reg

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This discussion clarifies transfer pricing regulations for VFX India Pvt Ltd's establishment of VFX Canada Ltd. It addresses whether capital can be transferred without TDS deduction via Overseas Direct Investment, and how proceeds from services rendered by VFX India to its Canadian clients should be handled. The advice suggests reporting to the RBI for certain transactions and clarifies the reporting requirements for Form 3CEB.

S.Jegadeesan

S.Jegadeesan (Querist)

16 November 2022 Sir
I wish to clarify the following
i.e. VFX India Pvt Ltd having regd office at Mumbai opened a Company in the name of VFX Canada Ltd with 3 Share Holders Including VFX India Pvt Ltd holding 95% of Shares .
1.Now whether VFX India can transfer the Capital Amount without deducting TDS under Overseas Direct Investment route to VFX Canada Ltd?
2.Can VFX Canada Ltd receive the Proceeds of bill raised by VFX India Pvt Ltd against the service rendered by VFX India Pvt Ltd to it's Canada Clients?
3.Whether the above is yes & should it be reported in 3CEB?
4.VFX Canada Ltd can convert the proceeds of sales bill( received from Canada clients) raised by VFX India Pvt Ltd as shares of VFX India Pvt Ltd in VFX Canada Ltd's books of A/c ?