Software Major's Transfer Pricing Conundrum - FAR Analysis Mandated for Multiple-Year Data Usage.

The case involves transfer pricing adjustments to international transactions due to non-compliance with conditions under Rule 10B(4) for using multiple-year data. The assessee must conduct a Functional Asset and Risk (FAR) analysis annually, as comparability factors may vary. The transfer pricing study relying on outdated data was rejected. Certain comparables in the manufacturing segment were dismissed due to differences in product, raw materials, and related party transactions exceeding 25%. The case was remitted to the Transfer Pricing Officer (TPO) for further examination. Expenditure on jigs and fixtures was deemed capital expenditure. Working capital adjustments were also remitted for verification. .....

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