“CUP method”

Transfer PricingSection 92CSection 92C828 judgments

The decision most relied on for CUP method is Serdia Pharmaceuticals (India) (P.) Ltd. v. Asstt. CIT (44 SOT 391), cited in 39 judgments on BharatTax.

Leading authorities on CUP method

Serdia Pharmaceuticals (India) (P.) Ltd. v. Asstt. CIT

44 SOT 391 · 2011 · ITAT

citing judgments

The Comparable Uncontrolled Price (CUP) method is preferred over indirect methods for determining the arm's length price in transfer pricing matters, especially for royalty payments.

Asstt. CIT v. MSS India (P.) Ltd.

32 SOT 132 · 2009 · ITAT

citing judgments

The Comparable Uncontrolled Price (CUP) method is preferred when comparable transactions with third parties are available to determine if transfer prices are at arm's length. Transactional profit methods are considered methods of last resort.

10 Glenmark Pharmaceuticals Ltd. v. Addl. CIT

43 Taxmann.com 191 · 2014 · Reported

citing judgments

Bank guarantee commission prices are not comparable to external CUPs for benchmarking corporate guarantees in transfer pricing.

CIT v. Eicher Motors Ltd.

293 ITR 464 · 2007 · High Court

citing judgments

Expenditure by way of royalty is an allowable revenue deduction if it is for a limited license to use know-how, where the assessee is not vested with proprietary rights. This is especially true if the payment falls within a reasonable range based on comparable transactions.

CIT v. Star Paper Mills Ltd.

172 Taxmann.com 391 · 2025 · High Court

citing judgments

The transfer price for intra-group services, specifically the sale of power from a captive power plant to a manufacturing unit, can be benchmarked based on the price at which the manufacturing unit procures power from the State Electricity Board, especially when it reflects a reasonable and arm's length price.

ACIT v. MSS India (P) Ltd.

123 TTJ 657 · 2009 · ITAT

citing judgments

A transfer pricing officer (TPO) must justify preferring one method over another, such as the Transactional Net Margin Method (TNMM) over the Comparable Uncontrolled Price (CUP) method, by demonstrating fallacies in the application of the preferred standard method.

Star India P. Ltd. v. ACIT

317 ITR 292 · 2009 · ITAT

citing judgments

When analyzing international transactions, separate classes of transactions, such as fees for technical know-how, use of trademarks, and procurement, must be analyzed individually, as each impacts profits. Aggregation of such transactions is not permissible.

Gharda Chemicals Ltd. v. Oy. CIT

39 SOT 93 · 2010 · ITAT

citing judgments

The Comparable Uncontrolled Price (CUP) method is the most preferred method for determining arm's length price in international transactions, but it requires a high degree of comparability. If comparables are not identical, the CUP method may not be applicable unless another method is proven to be more reliable in the specific fact situation.

Judgments citing CUP method

DCIT, Circle- 25(1), New Delhi vs. Wrigley India Pvt. Ltd., New Delhi

ITA 1294/DEL/2022[2015-16]Status: DisposedITAT Delhi29 May 2025AY 2015-16

Bench: Shri Vikas Awasthy & Shri Manish Agarwal

Section 250(6)Section 92CSection 92C(3)Section 92D

according to the revenue authorities, delayed. In any event, even when an ALP is made in respect excessive credit period allowed under the CUP method, stated by the TPO, the comparable has to be dues recoverable from a debtor and not a borrower. It appears that the TPO has adopted ... international 17 ITA Nos.667 & 702, 952 & 953/Del/2022 ITA No. 1293 to 1295/Del/2022 transactions under section 92 B, the right course of applying the CUP method, in the case of non charging of interest on overdue balances. would have been by comparing this not charging of interest with other cases

DCIT, Circle-25(1), New Delhi vs. Wrigley India P.Ltd, New Delhi

ITA 1293/DEL/2022[2014-15]Status: DisposedITAT Delhi29 May 2025AY 2014-15

Bench: Shri Vikas Awasthy & Shri Manish Agarwal

Section 250(6)Section 92CSection 92C(3)Section 92D

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘I': NEW DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI MANISH

JCIT, Circle-27(2), New Delhi vs. Wrigley India Pvt. Ltd., New Delhi

ITA 702/DEL/2019[2013-14]Status: DisposedITAT Delhi29 May 2025AY 2013-14

Bench: Shri Vikas Awasthy & Shri Manish Agarwal

Section 250(6)Section 92CSection 92C(3)Section 92D

payment is, according to the revenue authorities, delayed. In any event, even when an ALP is made in excessive credit period allowed under the CUP method, stated by the TPΟ, the comparable has to be dues recoverable from a debtor and not a borrower. It appears that ... that the continuing debit balances of associated enterprises can be treated as 'international transactions under section 92 B, the right course of applying the CUP method, in the case of non charging of interest on overdue balances. would have been by comparing this not charging of interest with other cases

Wrigley India Pvt. Ltd., 206, Okhla Industrial Estate, Phase-3, New Delhi-110020 vs. DCIT, Circle 27(2), New Delhi

ITA 667/DEL/2019[2013-14]Status: DisposedITAT Delhi29 May 2025AY 2013-14

Bench: Shri Vikas Awasthy & Shri Manish Agarwal

Section 250(6)Section 92CSection 92C(3)Section 92D

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘I': NEW DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI MANISH

Australia and New Zealand Banking Group Limited, Mumbai vs. DCIT (International Tax) 1(1)(2), Mumbai

In the result, appeal by the assessee is allowed

ITA 4778/MUM/2024[2020-21]Status: DisposedITAT Mumbai28 May 2025AY 2020-21

Bench: Shri Pawan Singh & Shri Girish Agrawalassessment Year: 2020-21

For Appellant: Shri. Madhur Agrawal, AdvocateFor Respondent: Shri. Kiran Unavekar, Sr. DR

Section 133(6)Section 143(3)Section 144C(3)Section 144C(5)Section 153

Ground 2: Rejecting the Transactional Net Margin Method (TNMM) used by the Appellant and adopting External Comparable Uncontrolled Price (CUP) method as the most appropriate method The learned AO, based on the directions of the Hon'ble DRP, erred in determining the ALP of the international transaction pertaining to processing ... TNMM') adopted by the Appellant and incorrectly concluding that the Appellant has adopted aggregation approach for benchmarking; d) in adopting external Comparable Uncontrolled Price ('CUP') method as the MAM, the learned AD/TPO erred in law and on facts, inter-alia on the following grounds: • Considering the information sought under section

Unilever India Exports Limited, Mumbai vs. Assistant Commissioner of Income-Tax Central Circle - 5(3), Mumbai

In the result, appeal filed by the assessee bearing ITA No

ITA 4301/MUM/2024[2020-21]Status: DisposedITAT Mumbai22 May 2025AY 2020-21

Bench: Shri Anikesh Banerjee & Miss Padmavathy S

For Appellant: Ms. Karishma Phatarphekar a/wFor Respondent: Shri Mukesh Thakwani (SR DR)

Section 143(3)Section 144C(13)Section 153Section 234CSection 270A

which reflected that payment for "Central Services” was included in the operating cost base. The assessee had benchmarked the transaction using the CUP method, details of which are as under: Particulars AY 2020-21 FAR and benchmarking discussion in TPSR APB Pg.303 to 304 No. of Comparable instances 4 Mean ... considered rival submissions and perused the material on record. Undisputedly, the assessee has benchmarked the payment of royalty under central service agreement by applying CUP method. Whereas, the Transfer Pricing Officer has determined the arm's length price of the royalty payment at nil on purely conjecture and surmises without

Milacron India Private Limited, Ahmedabad vs. The Dy. CIT, Circle-2(1)(1), Ahmedabad

The appeal of the assessee is allowed

ITA 2201/AHD/2024[2021-22]Status: DisposedITAT Ahmedabad21 May 2025AY 2021-22

Bench: S/Shri T.R. Senthil Kumar & Makarand V.Mahadeokarasstt.Year : 2021-22 Milacron India Pvt.Ltd. The Dcit, Cir.2(1)(1) Plot No.93/2 & 91/4 Vs Ahmedabad. Phase-1,Gidc Vatva, Ahmedabad. Pan : Aabcc 0881 D

For Appellant: Shri Prathvi Raj Meena, CIT-DR

Section 143(3)Section 144C(1)Section 144C(5)Section 270ASection 92BSection 92C

inserted by the Finance Act, 2012 with retrospective effect from 1st April 2002. 17. The DR highlighted that the TPO had applied the CUP method by benchmarking interest rates based on Bloomberg database, taking into account the currency of receivables (USD, GBP and EURO), and determined the arm’s length

The ACIT, Circle-2(1)(1), Ahmedabad vs. M/S. Intas Pharmaceuticals Ltd., Ahmedabad

Accordingly, this ground raised by the Revenue is dismissed

ITA 281/AHD/2021[2015-16]Status: DisposedITAT Ahmedabad21 May 2025AY 2015-16

Bench: S/Shri T.R. Senthil Kumar & Makarand V.Mahadeokarasstt.Year : 2015-16 Acit, Cir.2(1)(1) M/S.Intas Pharmaceuticals Ltd Vejalpur Vs Corporate House Ahmedabad. S.G. Highway Nr.Sola Bridge, Thaltej Ahmedabad 380 054. Pan : Aaaci 5120 L Asstt.Year : 2015-16 M/S.Intas Pharmaceuticals Ltd Acit, Cir.2(1)(1) Corporate House Vs Vejalpur S.G. Highway Ahmedabad. Nr.Sola Bridge, Thaltej Ahmedabad 380 054. Pan : Aaaci 5120 L (Applicant) (Responent) : Assessee By Shri S.N. Soparkar, Sr.Advocae & Shri Parin Shah, Ar : Shri Ragnesh Das, Cit-Dr Revenue By सुनवाई क" तारीख/Date Of Hearing : 28/04/2025 घोषणा क" तारीख /Date Of Pronouncement: 21/05/2025 आदेश आदेश/O R D E R आदेश आदेश

Section 115JSection 142(1)Section 143(2)Section 143(3)Section 144CSection 14ASection 35Section 36(1)(iii)Section 37Section 92C

similar issues were adjudicated. In those earlier years, the CIT(A) had rejected the assessee's benchmarking approach, which was based on an internal CUP method using a quotation from Bank of Nova Scotia, Singapore. The CIT(A) held that the quotation did not constitute a valid internal CUP ... binding commitment or an actual transaction. Furthermore, the CIT(A) accepted the TPO's application of an external CUP method, which included a forex risk adjustment of 100 basis points, considering the funds were advanced from India and repayments were subject to foreign exchange fluctuations. The CIT(A) also referred

Intas Pharmaceuticals Ltd., Ahmedabad vs. The DCIT, Circle-2(1)(1), Ahmedabad

Accordingly, this ground raised by the Revenue is dismissed

ITA 222/AHD/2021[2015-16]Status: DisposedITAT Ahmedabad21 May 2025AY 2015-16

Section 115JSection 142(1)Section 143(2)Section 143(3)Section 144CSection 14ASection 35Section 36(1)(iii)Section 37Section 92C

Aquity Solutions India Private Limited, Mumbai vs. Deputy Commissioner of Income Tax, Circle 15(1)(1), Mumbai

In the result, the appeal by the assessee is partly allowed

ITA 4817/MUM/2024[2020-21]Status: DisposedITAT Mumbai20 May 2025AY 2020-21

Bench: Shri Sandeep Singh Karhailshri Girish Agrawal

For Appellant: Shri Harsh ShahFor Respondent: Shri Ajay Ojha, Sr.DR

Section 143(3)Section 144C(13)Section 144C(5)Section 234ASection 234B

medical transcription services as per the specifications and instructions provided by the US AE. For benchmarking this transaction, the assessee adopted Comparable Uncontrolled Price (“CUP") method as the most appropriate method by considering itself as the tested party. For the determination of arm's length price (“ALP”), the assessee analysed ... assessee in terms of the number of lines as well as the value of the transactions, the TPO, inter-alia, proposed to reject the CUP method for benchmarking the international transaction pertaining to the provision of Medical Transcription Services. Since the assessee has benchmarked the international transaction pertaining

M/S Essar Shipping Ltd, Mumbai vs. Deputy Commissioner of Income Tax, Circle 5(1)(1), Mumbai

In the result, ground no. 5 raised by the assessee is dismissed

ITA 4440/MUM/2024[2020-21]Status: DisposedITAT Mumbai16 May 2025AY 2020-21

Bench: Ms. Kavitha Rajagopal, Jm & Shri Omkareshwar Chidara, Am

For Respondent: Shri. Piyush Chaturvedi

Section 143(2)Section 144Section 144C(1)Section 41Section 92B(2)Section 92C

DMCC but has failed to do so in the case of Varada, the ld. AO/TPO benchmarked the said transaction by using Comparable Uncontrolled Price (CUP method) as the most appropriate method (MAM) and rejected the Nil adjustment made by the assessee. The ld. AO determined 0.75% as guarantee commission

Deputy Commissioner of Income Tax, Circle-5(1), Kolkata vs. Dhunseri Ventures Limited, Kolkata

In the result, the appeal filed by the revenue is dismissed

ITA 968/KOL/2024[2016-17]Status: DisposedITAT Kolkata15 May 2025AY 2016-17

Bench: Shri Pradip Kumar Choubey&Shri Sanjay Awasthi]

Section 115JSection 80ISection 92C

which the non-eligible units/manufacturing units procured the power from unrelated party i.e. SEB. Now the issue before us whether the CUP method can be applied to bench mark specified domestic transactions of transferring power by CPPs to non eligible units. We have also perused the provisions as contained ... acquired under similar market conditions. It is also settled that choice of tested party is of lesser significance for the purpose of application of CUP method but instead key factor in application of CUP is product comparability and similar market conditions. Further the CUP method can be classified into

Natems Solar Power Private Limited, Hyderabad vs. Income Tax Officer, Ward 16(1), Hyderabad

ITA 140/HYD/2024[2020-21]Status: DisposedITAT Hyderabad14 May 2025AY 2020-21

Bench: Us:

Section 115JSection 143(3)Section 144BSection 234Section 234A

under the directions of the Hon'ble DRP erred in determining the arm’s length price (‘ALP’) of interest on CCDs by using CUP Method without analyzing or identifying any uncontrolled transaction of similar nature which is mandatory for application of the CUP method. 3 Natems Solar Power Private Limited ... under the directions of the Hon’ble DRP erred in determining the ALP of interest towards purchase on supplier credit by using CUP Method without analyzing or identifying any uncontrolled transaction of similar nature which is mandatory for application of the CUP method. 8. Without prejudice

S.N. Exports, New Delhi vs. ITO Ward-4, Panipat

In the result, all the appeals of Revenue are dismissed

ITA 2359/DEL/2019[2014-15]Status: DisposedITAT Delhi09 May 2025AY 2014-15

Bench: Shri M. Balaganesh & Shri Yogesh Kumar U.S.

For Appellant: NoneFor Respondent: Shri Sahil Kumar Bansal, Sr. DR

Section 143(3)Section 271GSection 92BSection 92DSection 92D(1)

furnished various information and documents as required by Rule 10D and submitted segment- wise PLI during the penalty proceedings. The appellant further submitted that CUP method could not be applied as each invoice of sale to AE and Non-AEs include different types of goods sold for different price ... peculiar character of the goods sold, the appellant did not consider the CUP method as the most appropriate method. It is also mentioned that the department accepted TNMM Method as the most appropriate method and no adjustment. were made in the preceding years. The TPO should have considered the peculiar

S.N. Exports, New Delhi vs. ITO Ward-4, Panipat

In the result, all the appeals of Revenue are dismissed

ITA 2358/DEL/2019[2014-15]Status: DisposedITAT Delhi09 May 2025AY 2014-15

Bench: Shri M. Balaganesh & Shri Yogesh Kumar U.S.

For Appellant: NoneFor Respondent: Shri Sahil Kumar Bansal, Sr. DR

Section 143(3)Section 271GSection 92BSection 92DSection 92D(1)

Joint Commissioner of Income Tax (OSD), Corporate Circle-1, Coimbatore vs. M/S C R I Pumps Private Limited, Coimbatore

In the result, all the three appeals filed by the Revenue are dismissed…

ITA 267/CHNY/2025[2016]Status: DisposedITAT Chennai07 May 2025

Bench: Hon’Ble Shri Manu Kumar Giri & Hon’Ble Shri Amitabh Shuklaआयकर अपील सं./Ita No.265/Chny/2025, Assessment Years: 2014-15 आयकर अपील सं./Ita No.266/Chny/2025, Assessment Years: 2015-16 आयकर अपील सं./Ita No.267/Chny/2025, Assessment Years: 2016-17

For Appellant: Shri N. Arjun Raj, AdvocateFor Respondent: Shri Saujanya Ranjan, IRS

Section 40A(2)(a)

appellant. The appellant has obtained bank guarantee @ 0.75% to 1% from IDBI and requested the same to be adopted as MAM under the CUP method. As the additional ground is relevant for a fair adjudication of the issue at hand, the same is admitted. 4.1.5 Regarding the additional ground ... dated 15.07.2013 wherein bank guarantee commission is charged @ 0.75% to 1% p.a. plus applicable service tax. The TPO observed on the basis of external CUP method that the arithmetic mean of the rates of bank guarantees was 2.19% and valued the additional risk assumed by the appellant at a conservative

Joint Commissioner of Income Tax (OSD), Corporate Circle-1, Coimbatore vs. M/S C R I Pumps Private Limited, Coimbatore

In the result, all the three appeals filed by the Revenue are dismissed…

ITA 266/CHNY/2025[2015]Status: DisposedITAT Chennai07 May 2025

For Appellant: Shri N. Arjun Raj, AdvocateFor Respondent: Shri Saujanya Ranjan, IRS

Section 40A(2)(a)

Joint Commissioner of Income Tax (OSD), Corporate Circle-1, Coimbatore vs. M/S C R I Pumps Private Limited, Coimbatore

In the result, all the three appeals filed by the Revenue are dismissed…

ITA 265/CHNY/2025[2014]Status: DisposedITAT Chennai07 May 2025

For Appellant: Shri N. Arjun Raj, AdvocateFor Respondent: Shri Saujanya Ranjan, IRS

Section 40A(2)(a)

Dsm Shared Services India Private Limited, Hyderabad vs. ACIT, Circle-8(1), Hyderabad

In the result, the appeal of the assessee is partly allowed for statistical purpose

ITA 501/HYD/2022[2018-19]Status: DisposedITAT Hyderabad05 May 2025AY 2018-19

Bench: Shri Vijay Pal Rao & Shri Madhusudan Sawdia

For Appellant: Shri Aliasgar Rampurawala, C.AFor Respondent: Shri B. Bala Krishna, CIT-DR

Section 143(3)Section 43B

have referred to the PLR rates only by way of analogy so as to state the prevailing interest rates in India, but while applying CUP method for comparability, they had applied LIBOR rates prevailing and had applied a mark-up of 700 points on ITA No.501/Hyd/2022 17 account

Open Text Technologies India Private Limited, Hyderabad vs. Dy. Commissioner of Income Tax, Circle-16(2), Hyderabad

ITA 2387/HYD/2018[2014-15]Status: DisposedITAT Hyderabad05 May 2025AY 2014-15

Bench: Shri Vijay Pal Rao, Hon’Ble & Shri Madhusudan Sawdia, Hon'Ble

For Appellant: Revenue byFor Respondent: Date of hearing

Section 143(3)Section 92B

आयकर अपीलीय अधिकरण, हैदराबाद पीठ में IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B”, HYDERABAD BEFORE SHRI VIJAY PAL