| COURT: | ITAT Delhi |
| CORAM: | George George K (JM), Sudhakar Reddy (AM) |
| SECTION(S): | 92CA, Rule 10B |
| GENRE: | Transfer Pricing |
| CATCH WORDS: | ALP, Transfer Pricing, working capital adjustment |
| COUNSEL: | Tarun Arora |
| DATE: | March 26, 2015 (Date of pronouncement) |
| DATE: | April 6, 2015 (Date of publication) |
| AY: | 2010-11 |
| FILE: | Click here to view full post with file download link |
| CITATION: | |
| Tranfer Pricing: While an adjustment for working capital investment is required, the transaction of sale of goods and receivables arising therefrom can be aggregated. If the differential impact of working capital has been factored in the pricing of the transaction of sale, no further adjustment can be made | |
Any separate adjustment on the pretext of outstanding receivables while accepting the comparables and transfer price of underlying transaction i.e. sale of goods by application of TNMM is unjustified. The differential impact of working capital of the assessee vis-a-vis its comparables has already been factored in the pricing/ profitability of the assessee and therefore, any further adjustment to the margins of the assessee on the pretext of outstanding receivables is unwarranted and wholly unjustified
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