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“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
39
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
26
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
26
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
22
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
21
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
16
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
16
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
16
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

ADIT Cir 3(2), Mumbai vs. The Bank of Nova Scotia, Mumbai

ITA 3989/MUM/2012[2007-08]Status: DisposedITAT Mumbai29 Jan 2024AY 2007-08

Bench: Shri Vikas Awasthy & Shri Amarjit Singh

For Appellant: Nishant Thakkar &For Respondent: Anil Sant
Section 143(2)Section 14ASection 92C(2)

Page 1 11 Appeals The Bank of Novascotia Vs. ADIT(IT) 3(2) IN THE INCOME TAX APPELLATE TRIBUNAL “I

The Bank of Nova Scotia, Mumbai vs. ADIT (It) 3(2), Mumbai

ITA 5740/MUM/2011[2005-06]Status: DisposedITAT Mumbai29 Jan 2024AY 2005-06

Bench: Shri Vikas Awasthy & Shri Amarjit Singh

For Appellant: Nishant Thakkar &For Respondent: Anil Sant
Section 143(2)Section 14ASection 92C(2)

Page 1 11 Appeals The Bank of Novascotia Vs. ADIT(IT) 3(2) IN THE INCOME TAX APPELLATE TRIBUNAL “I

ADIT (It) 3(2), Mumbai vs. The Bank Nova Scotia, Mumbai

Appeal of the assessee is allowed

ITA 5634/MUM/2011[2005-06]Status: DisposedITAT Mumbai29 Jan 2024AY 2005-06

Bench: Shri Vikas Awasthy & Shri Amarjit Singh

For Appellant: Nishant Thakkar &For Respondent: Anil Sant
Section 143(2)Section 14ASection 92C(2)

Page 1 11 Appeals The Bank of Novascotia Vs. ADIT(IT) 3(2) IN THE INCOME TAX APPELLATE TRIBUNAL “I

The Bank of Nova Scotia, Mumbai vs. ADIT (It) 3(2), Mumbai

In the result, the appeals of the assessee are partly allowed and

ITA 8841/MUM/2010[2006-07]Status: DisposedITAT Mumbai29 Jan 2024AY 2006-07

Bench: Shri Vikas Awasthy & Shri Amarjit Singh

For Appellant: Nishant Thakkar &For Respondent: Anil Sant
Section 143(2)Section 14ASection 92C(2)

most appropriate method and TPO has determined the arm's length price without rejecting the TNMM. The ld. Counsel also submitted that CUP method is not applicable for Page 18 11 Appeals The Bank of Novascotia Vs. ADIT(IT) 3(2) determination of arm's length price in respect ... assessee. He further submitted that vide letter dated 11.10.2011 the assessee has brought to the information of the transfer pricing officer that CUP method cannot be applied in the case of the assessee as no public information is available with regard to the similar transaction with the third parties

The ADIT (It)-3(2), Mumbai vs. M/S. the Bank of Novascotia, Mumbai

Appeal of the assessee is allowed

ITA 4655/MUM/2007[2003-2004]Status: DisposedITAT Mumbai29 Jan 2024AY 2003-2004

Bench: Shri Vikas Awasthy & Shri Amarjit Singh

For Appellant: Nishant Thakkar &For Respondent: Anil Sant
Section 143(2)Section 14ASection 92C(2)

Page 1 11 Appeals The Bank of Novascotia Vs. ADIT(IT) 3(2) IN THE INCOME TAX APPELLATE TRIBUNAL “I

Toyota Kirloskar Motor Private Limited, Bangalore vs. DCIT, Circle-7(1)(1), Bangalore

In the result, appeal of the assessee is partly allowed

ITA 863/BANG/2023[2018-19]Status: DisposedITAT Bangalore22 Jan 2024AY 2018-19

Bench: Shri George George K. & Shri Chandra Poojari

For Appellant: Shri Narendra Kumar Jain, A.RFor Respondent: Shri Senthil Kumar N., D.R
Section 40A(2)

therefore proposed to benchmark royalty payments separately. The TNNM as MAM was not accepted by the TPO, who instead adopted the CUP method as the most appropriate method for benchmarking of royalty. 4.5.2.6 In response to the TPO's proposal, the assessee proposed that even if royalty needed

D.C.I.T., Circle-6(1), Kolkata vs. M/S Birla Corporation Ltd., Kolkata

In the result, the appeal of the revenue as well as cross-objection of the assessee are partly allowed

ITA 1964/KOL/2019[2015-16]Status: DisposedITAT Kolkata16 Jan 2024AY 2015-16

Bench: Shri Sanjay Garg & Shri Girish Agrawali.T.A. No.1964/Kol/2019 Assessment Year: 2015-16 Dcit, Circle-6(1), Kolkata…………….......................…...……………....Appellant Vs. M/S Birla Corporation Ltd…………...........…..........................…..…..... Respondent Birla Building, 9/1, R.N. Mukherjee Road, Kolkata – 700001. [Pan: Aabcb2075J] C.O. 39/Kol/2019 (A/O I.T.A. No.1964/Kol/2019) Assessment Year: 2015-16 M/S Birla Corporation Ltd…………...........….....................…..…..... Cross-Objector Birla Building, 9/1, R.N. Mukherjee Road, Kolkata – 700001. [Pan: Aabcb2075J] Vs Dcit, Circle-6(1), Kolkata…………….......................…...……………....Respondent Appearances By: Shri Abhijit Kundu, Cit-Dr, Advocate, Appeared On Behalf Of The Department. Shri J. P. Khaitan, Sr. Counsel, Appeared On Behalf Of The Assessee. Date Of Concluding The Hearing : October 18, 2023 Date Of Pronouncing The Order : January 16, 2024 आदेश / Order संजय गग", "या"यक सद"य "वारा / Per Sanjay Garg: The Present Appeal By The Revenue & The Corresponding Cross Objections By The Assessee Have Been Preferred Against The Order Dated 30.05.2019 Of The Commissioner Of Income Tax (Appeals)-22, Kolkata [Hereinafter Referred To As ‘Cit(A)’] Passed U/S 250 Of The Income Tax Act (Hereinafter Referred To As The ‘Act’). First, We Take Up Revenue’S Appeal Ita No.1964/Kol/2019. I.T.A. No.1964/Kol/2019 & C.O. 39/Kol/2019 M/S Birla Corporation Ltd

Section 115JSection 14ASection 250Section 80I

noted that both the parties have in principle accepted and agreed that the most appropriate method for determination of ALP of power tariff is CUP Method. In the Ld. TPO's opinion the power tariff orders issued the relevant SECs was the most relevant indicator of the arm's length ... earlier paragraphs. From the I.T.A. No.1964/Kol/2019 & C.O. 39/Kol/2019 M/s Birla Corporation Ltd foregoing the question to be decided is that for application of CUP Method what should-be the most appropriate data and the price to-be adopted. It is well understood that CUP Method can be applied where

The ACIT, Circle-1(1)(1), Vadodara vs. Schaeffler India Limited (Earlier Known As Fag Bearings India Ltd.), Vadodara

Appeals are partly allowed for statistical purposes and Department’s appeals are dismissed

ITA 150/AHD/2023[2013-14]Status: DisposedITAT Ahmedabad12 Jan 2024AY 2013-14

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Bhavin Marfatia, A.RFor Respondent: Dr. Darsi Suman Ratnam, CIT D.R. & Shri
Section 234Section 234ASection 271(1)(c)Section 37Section 90(2)

facts in deleting the addition of Rs.2,13,09,160/ (upward adjustment) proposed by the TPO on account of benchmarking of Royalty using CUP Method instead of TNMM Method? 2. Whether, the Ld.CIT(A) has erred in law and on facts in not appreciating the findings of the TPO that ... Counsel for the assessee, therefore, we are of the considered view that the ld. CIT(A) and TPO were not justified in adopting the CUP method and therefore, we direct the ld. CIT(A) to adopt the method of TNMM for determination of the ALP and recompute

The ACIT, Circle-1(1)(1), Vadodara vs. Schaeffler India Limited (Earlier Known As Fag Bearings India Ltd.), Vadodara

Appeals are partly allowed for statistical purposes and Department’s appeals are dismissed

ITA 149/AHD/2023[2012-13]Status: DisposedITAT Ahmedabad12 Jan 2024AY 2012-13

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Bhavin Marfatia, A.RFor Respondent: Dr. Darsi Suman Ratnam, CIT D.R. & Shri
Section 234Section 234ASection 271(1)(c)Section 37Section 90(2)

facts in deleting the addition of Rs.2,13,09,160/ (upward adjustment) proposed by the TPO on account of benchmarking of Royalty using CUP Method instead of TNMM Method? 2. Whether, the Ld.CIT(A) has erred in law and on facts in not appreciating the findings of the TPO that ... Counsel for the assessee, therefore, we are of the considered view that the ld. CIT(A) and TPO were not justified in adopting the CUP method and therefore, we direct the ld. CIT(A) to adopt the method of TNMM for determination of the ALP and recompute

The ACIT, Circle-1(1)(1), Vadodara vs. Schaeffler India Limited (Earlier Known As Fag Bearings India Ltd.), Vadodara

Appeals are partly allowed for statistical purposes and Department’s appeals are dismissed

ITA 148/AHD/2023[2011-12]Status: DisposedITAT Ahmedabad12 Jan 2024AY 2011-12

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Bhavin Marfatia, A.RFor Respondent: Dr. Darsi Suman Ratnam, CIT D.R. & Shri
Section 234Section 234ASection 271(1)(c)Section 37Section 90(2)

facts in deleting the addition of Rs.2,13,09,160/ (upward adjustment) proposed by the TPO on account of benchmarking of Royalty using CUP Method instead of TNMM Method? 2. Whether, the Ld.CIT(A) has erred in law and on facts in not appreciating the findings of the TPO that ... Counsel for the assessee, therefore, we are of the considered view that the ld. CIT(A) and TPO were not justified in adopting the CUP method and therefore, we direct the ld. CIT(A) to adopt the method of TNMM for determination of the ALP and recompute

The ACIT, Circle-1(1)(1), Vadodara vs. Schaeffler India Limited (Earlier Known As Fag Bearings India Ltd.), Vadodara

Appeals are partly allowed for statistical purposes and Department’s appeals are dismissed

ITA 147/AHD/2023[2010-11]Status: DisposedITAT Ahmedabad12 Jan 2024AY 2010-11

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Bhavin Marfatia, A.RFor Respondent: Dr. Darsi Suman Ratnam, CIT D.R. & Shri
Section 234Section 234ASection 271(1)(c)Section 37Section 90(2)

facts in deleting the addition of Rs.2,13,09,160/ (upward adjustment) proposed by the TPO on account of benchmarking of Royalty using CUP Method instead of TNMM Method? 2. Whether, the Ld.CIT(A) has erred in law and on facts in not appreciating the findings of the TPO that ... Counsel for the assessee, therefore, we are of the considered view that the ld. CIT(A) and TPO were not justified in adopting the CUP method and therefore, we direct the ld. CIT(A) to adopt the method of TNMM for determination of the ALP and recompute

Schaeffler India Limited (Earlier Known As Fag Bearings India Ltd.), Vadodara vs. The Assistant Commissioner of Income Tax, Circle-1(1)(2) Now Circle-1(1)(1), Vadodara

Appeals are partly allowed for statistical purposes and Department’s appeals are dismissed

ITA 137/AHD/2023[2014-15]Status: DisposedITAT Ahmedabad12 Jan 2024AY 2014-15

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Bhavin Marfatia, A.RFor Respondent: Dr. Darsi Suman Ratnam, CIT D.R. & Shri
Section 234Section 234ASection 271(1)(c)Section 37Section 90(2)

facts in deleting the addition of Rs.2,13,09,160/ (upward adjustment) proposed by the TPO on account of benchmarking of Royalty using CUP Method instead of TNMM Method? 2. Whether, the Ld.CIT(A) has erred in law and on facts in not appreciating the findings of the TPO that ... Counsel for the assessee, therefore, we are of the considered view that the ld. CIT(A) and TPO were not justified in adopting the CUP method and therefore, we direct the ld. CIT(A) to adopt the method of TNMM for determination of the ALP and recompute

Schaeffler India Limited (Earlier Known As Fag Bearings India Ltd.), Vadodara vs. The Assistant Commissioner of Income Tax, Circle-1(1)(2) Now Circle-1(1)(1), Vadodara

Appeals are partly allowed for statistical purposes and Department’s appeals are dismissed

ITA 136/AHD/2023[2013-14]Status: DisposedITAT Ahmedabad12 Jan 2024AY 2013-14

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Bhavin Marfatia, A.RFor Respondent: Dr. Darsi Suman Ratnam, CIT D.R. & Shri
Section 234Section 234ASection 271(1)(c)Section 37Section 90(2)

facts in deleting the addition of Rs.2,13,09,160/ (upward adjustment) proposed by the TPO on account of benchmarking of Royalty using CUP Method instead of TNMM Method? 2. Whether, the Ld.CIT(A) has erred in law and on facts in not appreciating the findings of the TPO that ... Counsel for the assessee, therefore, we are of the considered view that the ld. CIT(A) and TPO were not justified in adopting the CUP method and therefore, we direct the ld. CIT(A) to adopt the method of TNMM for determination of the ALP and recompute

Schaeffler India Limited (Earlier Known As Fag Bearings India Ltd.), Vadodara vs. The Assistant Commissioner of Income Tax, Circle-1(1)(2) Now Circle-1(1)(1), Vadodara

Appeals are partly allowed for statistical purposes and Department’s appeals are dismissed

ITA 135/AHD/2023[2012-13]Status: DisposedITAT Ahmedabad12 Jan 2024AY 2012-13

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Bhavin Marfatia, A.RFor Respondent: Dr. Darsi Suman Ratnam, CIT D.R. & Shri
Section 234Section 234ASection 271(1)(c)Section 37Section 90(2)

facts in deleting the addition of Rs.2,13,09,160/ (upward adjustment) proposed by the TPO on account of benchmarking of Royalty using CUP Method instead of TNMM Method? 2. Whether, the Ld.CIT(A) has erred in law and on facts in not appreciating the findings of the TPO that ... Counsel for the assessee, therefore, we are of the considered view that the ld. CIT(A) and TPO were not justified in adopting the CUP method and therefore, we direct the ld. CIT(A) to adopt the method of TNMM for determination of the ALP and recompute

Schaeffler India Limited (Earlier Known As Fag Bearings India Ltd.), Vadodara vs. The Assistant Commissioner of Income Tax, Circle-1(1)(2) Now Circle-1(1)(1), Vadodara

Appeals are partly allowed for statistical purposes and Department’s appeals are dismissed

ITA 134/AHD/2023[2011-12]Status: DisposedITAT Ahmedabad12 Jan 2024AY 2011-12

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Bhavin Marfatia, A.RFor Respondent: Dr. Darsi Suman Ratnam, CIT D.R. & Shri
Section 234Section 234ASection 271(1)(c)Section 37Section 90(2)

facts in deleting the addition of Rs.2,13,09,160/ (upward adjustment) proposed by the TPO on account of benchmarking of Royalty using CUP Method instead of TNMM Method? 2. Whether, the Ld.CIT(A) has erred in law and on facts in not appreciating the findings of the TPO that ... Counsel for the assessee, therefore, we are of the considered view that the ld. CIT(A) and TPO were not justified in adopting the CUP method and therefore, we direct the ld. CIT(A) to adopt the method of TNMM for determination of the ALP and recompute

Schaeffler India Limited (Earlier Known As Fag Bearings India Ltd.), Vadodara vs. The Assistant Commissioner of Income Tax, Circle-1(2) Now Circle-1(1)(1), Vadodara

Appeals are partly allowed for statistical purposes and Department’s appeals are dismissed

ITA 133/AHD/2023[2010-11]Status: DisposedITAT Ahmedabad12 Jan 2024AY 2010-11

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Bhavin Marfatia, A.RFor Respondent: Dr. Darsi Suman Ratnam, CIT D.R. & Shri
Section 234Section 234ASection 271(1)(c)Section 37Section 90(2)

facts in deleting the addition of Rs.2,13,09,160/ (upward adjustment) proposed by the TPO on account of benchmarking of Royalty using CUP Method instead of TNMM Method? 2. Whether, the Ld.CIT(A) has erred in law and on facts in not appreciating the findings of the TPO that ... Counsel for the assessee, therefore, we are of the considered view that the ld. CIT(A) and TPO were not justified in adopting the CUP method and therefore, we direct the ld. CIT(A) to adopt the method of TNMM for determination of the ALP and recompute

The Tata Power Co. Ltd, Mumbai vs. Addl CIT RG 2(3), Mumbai

In the result, appeal of the assessee is partly allowed

ITA 753/MUM/2013[2008-09]Status: DisposedITAT Mumbai12 Jan 2024AY 2008-09

Bench: Shri Vikas Awasthy& Ms. Padmavathy.Sआअसं.753/मुं/2013 (िन.व. 2008-09) The Tata Power Co. Ltd. Corporate Center, Block ‘B’, 5Th Floor, 34, Sant Thukaram Road, Carnak Bunder, Mumbai 400 009. Pan: Aaact-0054-A ...... अपीलाथ"/Appellant बनाम Vs. Additional Commissioner Of Income Tax, Range 2(3), Mumbai. Aaykar Bhavan, M.K.Road, Mumbai – 400 020 ....."ितवादी/Respondent

For Appellant: Shri Nitesh Joshi with Shri Ninad PatadeFor Respondent: Shri Manoj Kumar&
Section 143(3)Section 14ASection 14A(2)

based on rate charged by SBI and Allahabad bank which is used in another assessee's case. He submitted that the CUP method requires a high degree of comparability of products and functions and the rates adopted by TPO based on generic rates provided by Allahabad Bank and SBI, where ... loan being huge i.e. USD 950 million, the assessee justified the said rate and considered the same to be at arm's length. The CUP method requires a high degree of comparability of products and functions, therefore, we see merit in the contention of the TPO. The rate obtained from

Dsi-Bridgecon India Private Limited, New Delhi vs. ACIT, Circle-7(2), Delhi

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

ITA 798/DEL/2022[2016-17]Status: DisposedITAT Delhi27 Dec 2023AY 2016-17

Bench: SHRI SHAMIM YAHYA (Accountant Member), SHRI ANUBHAV SHARMA (Judicial Member)

For Appellant: Shri Neeraj Jain, AdvocateFor Respondent: Shri Rajesh Kumar, CIT DR
Section 143(3)Section 92C

have been provided by the associated enterprise to the appellant on cost to cost basis and the transaction is at arm's length applying CUP method. 2.4 That the CIT(A)ITPO erred on facts and in law in not appreciating that the services have been provided by the associated

Michael Page International Recruitment Private Limited, Mumbai vs. Deputy Commissioner of Income Tax 14(2)(2), Mumbai

The appeal of the assessee is allowed

ITA 1190/MUM/2019[2013-14]Status: DisposedITAT Mumbai26 Dec 2023AY 2013-14

Bench: Shri Vikas Awasthy, Jm & Ms Padmavathy S, Am

For Respondent: Ms. A. Alankrutha, Sr. DR
Section 143(3)

comparable transaction for considering the arm's length price at NIL. The argument of the ld DR is that the TPO has applied CUP method for determination of ALP at NIL cannot be accepted for the reason that for the purpose of determining the ALP by applying the CUP method

Arkha Solar Power Private Limited, Rajahmundary vs. DCIT-1, Kakinada

In the result, appeal of the assessee is allowed

ITA 92/VIZ/2022[2017-2018]Status: DisposedITAT Visakhapatnam22 Dec 2023AY 2017-2018

Bench: Shri Duvvuru Rl Reddy, Hon’Ble & Shri S Balakrishnan, Hon’Ble(Through Hybrid Hearing) आयकरअपीलसं./ I.T.A. No.92/Viz/2022 ("नधा"रणवष"/ Assessment Year : 2017-18) Arkha Solar Power Private Vs. Deputy Commissioner Of Limited, Income Tax-1, Elakolanu Village, 4Th Floor, Sri Deepthi Towers, Rangampeta, Rajahmundry, Main Road, Kakinada, Andhra Pradesh – 533294. Andhra Pradesh-533001. Pan: Aalca 4293K (अपीलाथ"/ Appellant) (""यथ"/ Respondent) अपीलाथ"क"ओरसे/ Assessee By : Ms. Karishma R. Phatarphekar ""याथ"क"ओरसे/ Revenue By : Dr. Satyasai Rath, Cit-Dr

For Appellant: Ms. Karishma R. PhatarphekarFor Respondent: Dr. Satyasai Rath, CIT-DR
Section 142(1)Section 143(1)Section 143(2)Section 143(3)Section 92C(1)

method. The Ld. TPO also observed that with respect to the payment of interest on the issue of NCDs and was benchmarked following the CUP method. The assessee in order to identify similar uncontrolled transactions made search in the following Websites viz., BSE, NSDL, CDSL. After applying the relevant filters ... deducted the TDS of Rs. 10,67,625/-. On examination of the TP documents for benchmarking the transaction, the Ld. TPO concurred with the CUP method as the most appropriate method under the given facts of the case. The Ld. TPO also observed that the assessee’s selection of final