Applicability of provisions of domestic transfer pricing

Facts: One of our client have paid Capital advance for purchase of Fixed Assets to its associate Company amounting to Rs 22Cr., in FY 15 - 16. Query Wether the Client is liable to get a report under 3ceb for income tax purpose. ie wether domestic transfer pricing will be applicable for him.
Replies (3)

Hi,

 

Yes the porvisions of Domestic transfer pricing will be applicable as this is a business transaction between related parties and the value exceeds the specified limit of Rs 20 crores.

Hey thanks, but i have a doubt that when in the next year when billing will be done,  and when we capitalise these advances or expense out the same, should i be required to get 3ceb report again, will the provisions again apply in that year?

Regarding domestic transfer pricing, the value of transactions have to be looked on every year. So it will not be applicable in the year you capitalise those expenses.

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