TPO and DRP have committed a fallacy, firstly, by considering ...

Error in Designating AE as "Tested Party" and Misusing USD Bond Rates for ALP Benchmarking: Focus on Borrower's Creditworthiness.

May 18, 2016

Case Laws Income Tax AT

TPO and DRP have committed a fallacy, firstly, by considering the AE as a “tested party” and secondly, relying upon USD Corporate Bond Rates to benchmark the ALP of the interest rate because the interest rates for bonds or loan has to be seen from the point of view of borrowers creditworthiness and not the lender’s creditworthiness. - AT

View Source

← Previous Next →

TPO and DRP have committed a fallacy, firstly, by considering ...

Error in Designating AE as "Tested Party" and Misusing USD Bond Rates for ALP Benchmarking: Focus on Borrower's Creditworthiness.

May 18, 2016

Case Laws Income Tax AT

You may also like:

The ITAT Mumbai held that the Transfer Pricing Officer (TPO) unjustifiably rejected the benchmarking analysis done by the assessee for determining the Arm's Length Price...

Transfer pricing adjustment - determination of ALP - Not only changing the tested party from the assessee to its AE, the CIT (Appeals) has also selected a domestic...

TP Adjustment - tested party - No infirmity in the order of the learned CIT(A) in directing the assessee to adopt the foreign associated enterprise as tested party with...

Transfer pricing adjustment – Indenting transactions - commission percentage from AE transactions should be benchmarked on the basis of commission rate from non-AE...

TP adjustment - TPO accepted ALP based on TNMM but sought separate benchmarking of notional interest on the outstanding receivables - if the impact of extended credit...

Appropriate rate for benchmarking - receivables from AEs - it would be most appropriate if the LIBOR rate is applied as most appropriate rate of interest for imputing...

Forum for Arbitration - Seat of the arbitral proceedings - The closest connection test strongly relied upon by Mr. Himani would only apply if it is unclear that a seat...

The ITAT held that interest payments on Compulsorily Convertible Debentures (CCDs) denominated in Indian currency must be benchmarked against domestic interest rates,...

TP Adjustment - Rejection of Associated Enterprises as the tested party - foreign Associated Enterprises satisfied all the criteria for being taken as a tested party....

Outstanding receivables from AEs exceeding agreed credit period constitutes separate international transaction of providing capital financing/lending receivables, not...

TP adjustment - onsite development and project coordination fee’ - Associated enterprise can be considered as a tested party, in the present case. Accordingly, we direct...

TP adjustment - Since the funds have been borrowed in USD and also advanced in USD, the currency and exchange risks are minimised and the only risk to be considered is...

TP adjustment to payment of interest on ECB loan - TPO himself has stated that while granting permission to the assessee for availing ECB loan, the RBI has fixed the...

TP Adjustment - secondment of employees by Assessee to its AE - the benchmarking done by the TPO by applying the same rate of thirty party placement agency is not...

TP adjustment - tested party - As per Guidance Note on report u/s 92E and transfer pricing guidelines issued by the OECD and united nation practical manual of transfer...

Quick Updates: