Search Results For: Resale Price Method


Zee Entertainment Enterprises Ltd vs. ACIT (ITAT Mumbai)

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DATE: May 5, 2017 (Date of pronouncement)
DATE: May 11, 2017 (Date of publication)
AY: 2008-09
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Transfer Pricing: Law explained as to when the “Resale Price Method” (RPM) can be used with respect to related parties under Rule 10B (1)(b) + Law on determining arm’s length rate of the corporate guarantee commission/fee explained

The Transfer Pricing Officer has selected RPM as most appropriate method for determining the arm’s length price of the transaction of sale of programmes and film rights to ATL in contrast to the TNM method selected by the assessee. The first controversy is as to whether the Transfer Pricing Officer was justified in selecting the RPM as most appropriate method. Section 92(1) of the Act provides that the arm’s length price in relation to the international transaction shall be determined by any of the methods prescribed therein, being the most appropriate method. Notably, the phraseology of section 92C(1) of the Act makes it clear that the selection of the most appropriate method is to be made “having regard to the nature of transaction or class of transaction or class of associated persons or functions performed by such persons or such other relevant factors………………..”. Further, Rule 10B of the Rules enumerates the various methods to determine the arm’s length price of an international transaction and for the present purpose, what is relevant is clause(b) of Rule 10B(1) of the Rules, which prescribes the manner in which the RPM is to be effectuated

Nokia India (P) Ltd vs. DCIT (ITAT Delhi)

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DATE: October 31, 2014 (Date of pronouncement)
DATE: November 3, 2014 (Date of publication)
AY: 2002-03
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(i) Method of applying Resale Price Method (RPM) method, (ii) high advertisement expenses has no bearing on the RPM, (iii) comparables with more than 25% of related party transactions (RPTs) have to be excluded, (iv) transactions which do not impact the profitability should be excluded from the formula, (v) potentially comparable companies cannot be expelled only on the ground of high or low turnover

(i) The assessee simply purchased mobile phones and accessories from Nokia group companies situated outside India and resold the same as such without any further value addition, mainly, to HCL Infosystems in India. Since the goods imported from the foreign

Yamaha Motor India Pvt. Ltd vs. ACIT (ITAT Delhi)

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DATE: October 29, 2014 (Date of pronouncement)
DATE: October 31, 2014 (Date of publication)
AY: 2007-08
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CITATION:
Rule 10B(1)(b): Resale Price Method applies even where the goods are bought from an AE and sold to another AE

The argument of the department that under Rule 10B(1)(b) the Resale Price Method can be applied only when the assessee buys from an associated enterprise and sells to a non-associated enterprise and not when the sale is to an AE

ACIT vs. Harper Collins Publishers India Ltd (ITAT Delhi)

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DATE: October 13, 2014 (Date of pronouncement)
DATE: October 18, 2014 (Date of publication)
AY: 2004-05
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CITATION:
Resale Price Method: If margins of the wholesale distributor can be compared with the margins of the assessee, no adjustment can be made

The assessee used Resale Price Method for benchmarking its international transactions so far as purchase of books is concerned. The claim of the assessee was that its purchase is at arm’s length price because while its gross margin for the

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