Transfer pricing adjustment concerning comparability selection ...

Tribunal Upholds Use of TNMM, Rejects Size-Based Comparable Exclusion in Transfer Pricing Dispute.

September 14, 2024

Case Laws Income Tax HC

Transfer pricing adjustment concerning comparability selection and attribution of profits between the respondent assessee and foreign Associated Enterprise. TPO rejected internal comparables due to size of transactions with AEs. ITAT held size alone cannot be grounds for rejecting comparables, unless transactions are contrived or abnormal. Internal TNMM comparing AE and non-AE profitability justified. ALP adjustment deleted. Identification of comparables key to transfer pricing analysis. Choice of method depends on availability of comparables and comparability adjustments. As comparability increases, potential inaccuracies decrease. Consistent with Sony Ericsson case. Attribution of profits between assessee and AE - appeals dismissed following principle of consistency.

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Transfer pricing adjustment concerning comparability selection ...

Tribunal Upholds Use of TNMM, Rejects Size-Based Comparable Exclusion in Transfer Pricing Dispute.

September 14, 2024

Case Laws Income Tax HC

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