Landmark Cases on Transfer Pricing

The jurisdictional High Court refuses to entertain the revenue's appeal where the Tribunal's decision on transfer pricing comparability has been consistently upheld in similar cases.

Adjustments made by the Transfer Pricing Officer (TPO) to the arm's length price (ALP) cannot be equated with disallowances of expenses, and the TPO does not have the authority to disallow expenses.

A company that has undergone amalgamation or merger during the relevant assessment year cannot be considered a comparable company for transfer pricing purposes because it is an extraordinary event that impacts financial results.

The benchmarking methodology used by an assessee, including the adoption of the Comparable Uncontrolled Price (CUP) method or another most appropriate method, is considered for determining the arm's length price of international transactions.

When an assessee acts as an intermediary or agent for an associated enterprise and is remunerated on a commission or cost-plus basis, the transfer pricing analysis should consider the OECD Guidelines concerning functions performed for and on behalf of the associated enterprise.