Never Ending Battle Of Transfer Pricing Disputes

SC On ALP Determination, Selection Of Filters As Substantial Question Of Law

Hon'ble Supreme Court ('SC') vide order dated 19th April 2023 in batch of appeals led by SAP Labs India Pvt. Ltd. ('SAP Labs') has set aside the principle laid down by Hon'ble Karnataka High Court's judgment on issue of selection of comparables and whether it constitutes a 'substantial question of law'.

It is a settled proposition that in the absence of demonstrated perversity in the findings of the Income Tax Appellate Tribunal ('Tribunal'), the Court cannot interfere, and a finding of fact may give rise to a substantial question of law, only if it is perverse. Therefore, the Tribunal is considered as the final fact-finding authority and an appeal before the High Court ('HC') can be preferred under Section 260A of the Income Tax Act, 1961 ('the Act') only on substantial question of law.