This Digest of case laws is prepared by KSA Legal and AIFTP from judgements reported in BCAJ, CTR, DTR, ITD, ITR, ITR (Trib), Chamber's Journal, SOT, Taxman, TTJ, BCAJ, ACAJ, www.itatonline.org and other journals
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S. 92C : Transfer pricing-Arm’s length price-Adjustment made in respect of international transaction on purchase of traded goods-Comparable-Adjustment was deleted.

B. Braun Medical (India) Pvt Ltd v. Dy.CIT (2022) 95 ITR 72 (SN) (Mum)(Trib)

S. 92C : Transfer pricing-Arm’s length price-Manufacturing segment-Under-Utilisation of capacity-Working capital adjustment-Foreign Exchange gain erroneously treated as Foreign Exchange Loss and included as part of cost-Payment made for group services-Mistake in treating the foreign exchange gain as foreign exchange loss and including it as part of cost was a computational mistake, required to be corrected in order to arrive at the correct margin-It was also held that the transfer pricing adjustment to the sales made to associated enterprises, under the transactional net margin method was required to be restricted to international transactions only.[S. 92CA]

SKF Engineering and Lubrication India Pvt. Ltd. v Dy. CIT (2022)95 ITR 24 (Bang)(Trib)

S. 92C : Transfer pricing-Arm’s length price-Working capital adjustment-No expenses incurred for Meeting working capital requirement-Question of adjustment on negative working capital does not arise–Selection of comparables-Assessee engaged in provision of software development and related services-Rejection of rental expenses held to be proper. [S. 92CA]

Harman Connected Services Corporation India P. Ltd. v. Dy. CIT (2022)95 ITR 1 (Bang)(Trib)

S. 92C : Transfer pricing-Arm’s length price-Royalty-Transactions Valued at Nil ignoring evidence brought on record-Transfer Pricing Adjustment is not sustainable.[S.92CA]

Expeditors International (India) Pvt. Ltd. v. Dy. CIT (2022) 95 ITR 393 (Delhi)(Trib)

S. 92C : Transfer pricing-Arm’s length price-Technical Know-how fees-Not adopting one of mandatorily prescribed methods-Deletion of addition is valid.

Dy. CIT v. India Kawasaki Motors Pvt. Ltd. (2022) 96 ITR 37 (SN) (Pune) (Trib)

S. 92C : Transfer pricing-Arm’s length price-Technical Know-how fees-Not adopting one of mandatorily prescribed methods-Deletion of addition is valid.

Dy. CIT v. India Kawasaki Motors Pvt. Ltd. (2022) 96 ITR 37 (SN) (Pune) (Trib)

S. 92C : Transfer pricing-Arm’s length price-Custom duty-Recovering part from customers-Adjustments required to be made. [R. 10B(1)(b)(iv)]

Dy. CIT v. India Kawasaki Motors Pvt. Ltd. (2022) 96 ITR 37 (SN) (Pune) (Trib)

S. 92C : Transfer Pricing-Arm’s Length Price-Manufacturing and marketing-Transactional Net Margin Method most appropriate-Transfer Pricing Officer’s Reasoning of constructing a hypothetical comparable uncontrolled price based on study of third party scenario is not envisaged [S.92CA]

Bostik India P. Ltd. v. Dy. CIT (2022)96 ITR 25 (SN) (Bang) (Trib)

S. 92C : Transfer Pricing-Arm’s Length Price-Comparables-Government of India Company not Comparable with Assessee-Excluded from List of Comparables. [S.92CA]

Dy. CIT v. Bmc Software (India) Pvt. Ltd. (2022)96 ITR 18 (SN) (Pune) (Trib)

S. 92C: Transfer pricing-Arm’s length price-Software development services-Working capital adjustment on account of outstanding receivables-Matter remanded. [S.92CA]

Xchanging Solutions Ltd. v. Dy. CIT (2022)96 ITR 544 (Bang) (Trib)