The Central Board of Direct Taxes (CBDT) has issued a very important instruction (Instruction No. 15/2015, dated: October 16, 2015) on the procedure for transfer pricing assessments/audits for international transactions.

The budget speech of the Finance Minister in 2014 referred to the concept of range and use of multiple year data to align Indian Transfer Pricing regime with international best practices.

Authority for Advance Rulings (AAR): Capital Gain arising on transfer of shares of Indian listed company was held to be exempt from tax in India in the hands of a company resident of Mauritius.

Under the Act, different powers have been conferred on different authorities to deal with the orders passed by the lower authorities.

AAR Ruling - transfer of shares of Indian Subsidiaries of an American company without consideration in a scheme approved for bankruptcy proceedings in an American Court would not attract capital gains and consequently, transfer pricing provisions cannot be applied in such transactions.

This judgement clearly brings out the importance of the most critical element of any transfer pricing analysis, i.e. the use of comparable data for the purpose of benchmarking the controlled transaction.

Direct Tax Individuals and HUFs

Kolkata Tribunal Special Bench Ruling – Whether an arm's length price adjustment was required to be made in respect of interest free loan granted by the assessee, a non-resident company, to its wholly owned subsidiary in India?