“arm's length price”

Transfer PricingSection 92Section 921,810 judgments

The decision most relied on for arm's length price is CIT v. EKL Appliances Ltd. (345 ITR 241), cited in 422 judgments on BharatTax.

Leading authorities on arm's length price

CIT v. EKL Appliances Ltd.

345 ITR 241 · 2012 · High Court

422

citing judgments

Transfer pricing adjustments for outstanding receivables are permissible only if the Tax Officer establishes, through analysis over a period, a pattern indicating an international transaction intended to benefit an associated enterprise. The Tax Officer cannot question purely business decisions like royalty payments or exceed jurisdiction by applying cost-benefit analysis to determine the arm's length price of services.

CIT v. Everest Kento Cylinders Ltd.

378 ITR 57 · 2015 · High Court

304

citing judgments

Corporate guarantee fees are subject to transfer pricing rules, and adjustments may be needed to account for differences between corporate guarantees and more liquid bank guarantees when determining arm's length price.

Maruti Suzuki India Ltd. v. CIT

381 ITR 117 · 2016 · High Court

220

citing judgments

The Bright Line Test (BLT) is not a recognized method under the Income-tax Act and Rules for benchmarking advertising, marketing, and promotion (AMP) expenses or for determining the existence of an international transaction or its Arm's Length Price. The Revenue must first establish the existence and price of an international transaction before seeking an ALP adjustment.

Chryscapital Investment Advisors (India) Pvt. Ltd. v. DCIT

376 ITR 183 · 2015 · High Court

170

citing judgments

For transfer pricing comparability analysis, companies should not be excluded solely based on higher turnover if they are otherwise functionally comparable, unless the turnover difference reflects fundamental functional dissimilarities, brand value, or risk profiles that materially impact profitability.

PCIT v. Redington (India) Ltd.

430 ITR 298 · 2021 · High Court

132

citing judgments

A corporate guarantee issued to Associated Enterprises (AEs) is an international transaction under Section 92B, requiring adjustments for guarantee commission due to inherent risk. The reasonable arm's length rate for benchmarking such corporate guarantees can be determined using internal or external comparable uncontrolled prices.

Bausch & Lomb Eye Care (India) Pvt. Ltd. v. Additional CIT

381 ITR 227 · 2016 · High Court

127

citing judgments

The existence of an international transaction must be established before its arm's length price can be determined. An alleged 'excessive' AMP expenditure cannot unilaterally expand the scope of an international transaction if its existence is contested.

CIT v. Cushman & Wakefield (India) (P.) Ltd.

367 ITR 730 · 2014 · High Court

120

citing judgments

This case determines the Arm's Length Price (ALP) for intra-group services and reimbursements, clarifying when charges constitute services warranting a mark-up versus mere pass-through costs. It provides guidance on the circumstances under which an ALP adjustment, including an ALP of 'nil', is appropriate for such transactions.

CIT v. Tata Autocomp Systems Ltd.

56 Taxmann.com 206 · 2015 · High Court

119

citing judgments

When determining the arm's length price for interest on a foreign currency loan advanced to an Associated Enterprise, the Indian Prime Lending Rate is not applicable. Instead, the interest rate should be benchmarked based on the prevailing foreign currency rate, such as EURIBOR, or the rate in the country where the loan is received/consumed.

Judgments citing arm's length price

Portescap India Private Limited, Mumbai vs. DCIT Circle 2(3)(1), Mumbai

In the result the appeal filed by the assessee stands partly allowed

ITA 6749/MUM/2024[2021-22]Status: DisposedITAT Mumbai28 Jul 2025AY 2021-22

Bench: Smt. Beena Pillai () & Shri Girish Agrawal ()

Section 143(3)Section 153Section 92C(3)

case and in law, the Ld. AO/Ld. TPO/Ld. DRP erred in making an adhoc disallowance of 50% of transaction value while determining the arm's length price of the Appellant's international transaction of payment of sales commission to its Associated Enterprise ('AE') Portescap S.A., Switzerland, resulting in a transfer ... aggregated/combined Transactional Net Margin Method ("TNMM") has been adopted as the most appropriate method ('MAM') for benchmarking the subject international transaction; 3.2Determining arm's length price of international transaction of payment for sales commission to AE as 'Nil' for the 50% value of the transaction, by adopting Other Method

Signode India Limited, Hyderabad vs. ACIT., Circle 3(1), Hyderabad

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

ITA 1376/HYD/2024[2021-22]Status: DisposedITAT Hyderabad25 Jul 2025AY 2021-22

Bench: Shri Vijay Pal Rao & Shri Madhusudan Sawdia

For Appellant: Shri H. Srinivasulu, C.AFor Respondent: Dr. Sachin Kumar, SR-DR

Section 143(3)Section 144BSection 144C(13)Section 153Section 92C(3)

total income of Rs.183,55,39,089/-. In view of the international transactions involved during the year under consideration, for determination of Arm’s Length Price (“ALP”), the case was referred to Learned Transfer Pricing Officer (“TPO”). The Ld. TPO vide his order dated 31.10.2023 suggested upward adjustment of Rs.1 ... referred to the PLR rates fixed in India. It is evident that the PLR rates were not the basis for fixing the arm's length price. Both TPO and the DRP have referred to the PLR rates only by way of analogy so as to state the prevailing interest rates

M/S. Laxmi Organic Industries Limited, Mumbai vs. Deputy Commissioner of Income Tax Circle 3(2)(1), Mumbai

ITA 4782/MUM/2024[2020-21]Status: DisposedITAT Mumbai25 Jul 2025AY 2020-21

Bench: Shri Pawan Singh & Shri Girish Agrawal

For Appellant: Shri Percy Pardiwala, Sr. Advocate andFor Respondent: Ms. Neena Jeph, CIT DR

Section 144C(5)Section 80I

assessing your appellant's income at Rs 93,72,50,260/- as against the returned income of Rs 5,83,67,890/-. Arm's length Price (ALP)/Transfer Pricing (TP) Adjustments - Jurisdictional Issues 2. On the facts and in the circumstances of the case, and in law, the learned Assessing ... Officer wholly erred in making addition on account of "Arm's length price in relation to international transactions with associated enterprises" amounting to "Rs 83,66,17,206", whereas, on the facts of this case, no additions in respect of "arm's length price adjustments" could, at all, have been

ACIT - 14(2) (2), Mumbai vs. Pfizer Ltd, Mumbai

ITA 1497/MUM/2018[2005-06]Status: DisposedITAT Mumbai25 Jul 2025AY 2005-06

Bench: Smt. Kavitha Rajagopal (Jm) & Shri Omkareshwar Chidara (Am) Acit-14(2)(2) M/S. Pfizer Limited 461, 4Th Floor The Capital, 802/1901 Aayakar Bhavan Vs. Plot No. C-70, G Block M.K. Road Bandra Kurla Complex Mumbai-400 020. Bandra East, Mumbai 400 0051. Pan : Aaacp3334M Appellant Respondent

For Appellant: Shri Nihar Ranjan SamalFor Respondent: Shri Vishal Kalra

Mumbai had issued notices under section 143(2) of the Act and he also referred it to Transfer Pricing Officer for determination of Arm's Length Price for the international transactions in the case of the assessee vide letter dated 14.10.2003. It ITA NO.6832 & 6772/MUM/2010 (A.Y. 2002-03) CO NO.190/MUM/2011

O.C Tanner India Private Limited, Mumbai vs. DCIT, Circle -2(3)(1), Mumbai

In the result the appeal is, accordingly, he appeal is, accordingly, allowed for statistical allowed for statistical purposes

ITA 5785/MUM/2024[2021-22]Status: DisposedITAT Mumbai24 Jul 2025AY 2021-22

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal () Assessment Year: 2021-22 O.C. Tanner India Pvt. Ltd., Dy. Cit, Circle-2(3)(1), No. 2, Lave 7 Tower 2, Phase Ii, 552, 5Th Floor, Aayakar Bhavan, Raiaskaran Techpark Andheri Vs. Maharishi Karve Road, Kurla Road, Andheri East, Mumbai-400020. Sakinaka S.O. Mumbai, Mumbai-400072. Pan No. Aabco 1031 F Appellant Respondent

For Appellant: Mr. Vijay Mehta, CA

Section 144C(13)Section 144C(5)

transaction carried out by the assessee with its Associated E ith its Associated Enterprises(AEs), t nterprises(AEs), the matter of determination of arm’s length price (ALP) of those international arm’s length price (ALP) of those international arm’s length price (ALP) of those international transactions was referred ... Arm's benefits to the Applicant, than what was determined as Arm's benefits to the Applicant, than what was determined as Arm's Length Price. Even, the Applicant assessee has failed to Length Price. Even, the Applicant assessee has failed to Length Price. Even, the Applicant assessee has failed

M/S. Tbea Shenyang Trasformer Gropup Company Limited, Vadodara vs. The Deputy Commissioner of Income Tax, Int. Tax., Vadodara

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

ITA 581/AHD/2017[2012-13]Status: DisposedITAT Ahmedabad22 Jul 2025AY 2012-13

Bench: Smt. Annapurna Gupta & Ms. Suchitra Kambleआयकर अपील सं./I.T.A. No. 581/Ahd/2017 (िनधा"रण वष" / Assessment Year : 2012-13) बनाम/ M/S. Tbea Shenyang Deputy Commissioner Of Transformer Group Income Tax Vs. Company Limited International Taxation, National Highway No.-8, Vadodara Villae : Miyagam, Karja, Vadodara, Gujarat - 390007 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aadct4557F (Appellant) .. (Respondent) अपीलाथ" ओर से /Appellant By : Shri Arpit Jain, Ar ""यथ" क" ओर से/Respondent By : Shri Mahesh Shah, Cit. Dr 24/04/2025 Date Of Hearing Date Of Pronouncement 22/07/2025 O R D E R Per Smt. Annapurna Gupta, Am:

For Appellant: Shri Arpit Jain, ARFor Respondent: Shri Mahesh Shah, CIT. DR

Section 143(3)Section 9Section 92C

Accordingly, reference u/s.92CA(1) of the Act was made by the AO to the Transfer Pricing Officer (TPO) for determination of Arm’s Length Price (ALP) of the international transaction executed between the head office and the project office. The assessee objected to the reference made ... entities and transactions entered into between them were international transactions which the AO was empowered to refer to the TPO for computation of Arm’s Length Price in terms of the provisions of Section 92CA of the Act. The AO further noted that though reference had been made only with

Samkit Shashikant Shah, Mumbai vs. Principal Commissioner of Income Tax -20, Mumbai

In the result, appeal of the assessee is allowed

ITA 3703/MUM/2025[2018-19]Status: DisposedITAT Mumbai21 Jul 2025AY 2018-19

Bench: Dropping The Reassessment Proceedings.”

Section 148Section 148ASection 148BSection 263

perfectly tallied carat to carat and there is no mismatch in the quantity record. Our sale and purchase have been done at Arm's length price with the actual delivery of goods. We have made the sales of diamonds purchased from above sald parties mentioned in the annexure

Daido India Pvt. Ltd., Gurgaon vs. DCIT, Circle- 1(1), Gurgaon

ITA 5761/DEL/2018[2014-15]Status: DisposedITAT Delhi21 Jul 2025AY 2014-15

Bench: Shri Ramit Kochar & Sh. Yogesh Kumar U.S.

Section 142(1)Section 143(2)Section 143(3)Section 271(1)(c)Section 92C

meaning of Section 92CA of the Act, a reference u/s 92CA(3) of the Act made to the TPO for determining the Arm's Length Price u/s 92CA (3) of the Act. 4. The TPO vide his order dated 24/10/2017, determined the adjustment/difference on account of Arm's Length Price

Spectraforce Technologies (India) Private Limited, Pune vs. ACIT, Circle 5, Pune

In the result, appeal of the assessee is partly allowed for statistical purposes as per terms indicated hereinabove

ITA 2853/PUN/2024[AY 2021-22]Status: DisposedITAT Pune18 Jul 2025

Bench: Dr.Manish Borad & Ms. Astha Chandra

For Appellant: Shri S. Raghunathan and Shri Abhiroop Bhargav KFor Respondent: Shri Prakash L. Pathade

Section 143(3)Section 92C(3)

ITAT DELHI in the case of GLOBAL VANTAGE PVT LTD VS DCIT (ITA NO: 2763 AND 2764/DEL/2009) that the adjustments (on ARM'S LENGTH PRICE), if any, cannot exceed the global profits earned by the group from those transactions, or else, it amounts to imposing an impossible burden ... median 3.16% and as per the assessee the international transaction of the assessee with its AE for the Staff Augmentation services were at Arm’s Length Price (ALP). Ld. TPO examined the TPSR and after considering the submissions of the assessee as well as the comparables introduced by TPO, final

Samsung Sdi India Pvt Ltd., Noida vs. DCIT, Circle-5(2)(1), Noida

In the result, appeal of the assessee is partly allowed

ITA 5475/DEL/2024[2021-22]Status: DisposedITAT Delhi18 Jul 2025AY 2021-22

Bench: Shri Challa Nagendra Prasad & Shri Manish Agarwal

Section 143(1)Section 143(3)Section 92C

without providing any cogent reason. Furthermore, the Learned AO and TPO erred in applying the Transactional Net Margin Method (TNMM) for determining the Arm's Length Price (ALP) of the international transactions undertaken by the Appellant for its distribution operations. 4. That the Ld. DRP/AO/TPO erred in determining the arm ... given by Ld.DRP in para 6.1 reads as under:- 6.1 “In this ground, assessee has challenged the application of TNMM to evaluate the arm's length price of the international transaction entered into by assessee entity. It is pertinent to mention that the TPO has applied the TNMM

Samsung Sdi India Pvt Ltd, Noida vs. Assessment Unit, Income-Tax Department, National Faceless Assessment Centre New Delhi, New Delhi

ITA 3472/DEL/2024[2020-21]Status: DisposedITAT Delhi18 Jul 2025AY 2020-21

Bench: Shri Challa Nagendra Prasad & Shri Manish Agarwal

Section 143(1)Section 143(3)Section 92C

Ivy Software Development Services Private Limited, Hyderabad vs. DCIT, Circle -2(1), Hyderabad

In the result, the ground no

ITA 73/HYD/2022[2017-18]Status: DisposedITAT Hyderabad16 Jul 2025AY 2017-18

Bench: Shri Vijay Pal Rao & Shri Madhusudan Sawdia

For Appellant: Shri Nageswar Rao, AdvocateFor Respondent: Shri B. Bala Krishna, CIT-DR

Section 143(2)Section 143(3)Section 144C(5)

view of International transaction with Associated Enterprises (“AEs”), the matter was referred to Learned Transfer Pricing Officer (“Ld. TPO”) for determination of Arm’s Length Price (“ALP”). The Ld. TPO vide his order dated 29.01.2021 suggested upward adjustment of Rs.10,04,72,389/- on account of provision of Software Development ... submitted that in light of these facts, Wipro is functionally and economically not comparable with the assessee, and its inclusion would distort the arm’s length price determination. 10. The Ld. AR sought exclusion of Nihilent, contending that the company is functionally dissimilar and operates in IT consultancy and enterprise

Thermo Fisher Scientific India P. Ltd, Mumbai vs. DCIT 15(3)(1), Mumbai

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

ITA 2458/MUM/2015[2010-11]Status: DisposedITAT Mumbai16 Jul 2025AY 2010-11

Bench: Shri Vikram Singh Yadavshri Sandeep Singh Karhail

For Appellant: Shri Dhanesh Bafna, Shri Amol MahajanFor Respondent: Shri Ajay Chandra, CIT-DR

Section 143(3)Section 144CSection 144C(5)Section 32(1)

case and in law, the Hon'ble DRP and learned DCIT erred in confirming the learned TPO's action of determining the arm's length price of the appellant's international transaction of reimbursement of expenses (in the nature of SAP development cost, inter- connectivity charges, professional expenses and administrative ... reference by the AO under section 92CA(1) of the Act to the Transfer Pricing Officer (“TPO”) for the determination of the arm's length price of the international transactions entered into by the assessee, it was observed that the assessee had incurred an expenditure

Jubilant Foodworks Ltd, Noida vs. ACIT, Circle, 5(1)(1)., Gautam Buddha Nager

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

ITA 2310/DEL/2022[2018-19]Status: DisposedITAT Delhi16 Jul 2025AY 2018-19

Bench: Shri Challa Nagendra Prasad & Shri Manish Agarwal

Section 143(2)Section 143(3)Section 144(1)Section 144CSection 144C(13)Section 144C(5)Section 924ASection 928Section 92CSection 92F

international transactions with related parties therefore, the case of the assessee was referred to Transfer Pricing Officer (“TPO”) for Page | 1 determination of Arm’s Length Price [“ALP”] of such transactions. The TPO vide order dated 31.07.2021 u/s 92CA(3) of the Act proposed certain adjustments. The AO passed draft ... Income Tax Rules, 1962 (‘the Rules). 7.3. Undertaking comparison between two alleged controlled transactions in order to arrive at the arm's length price. Grounds on Corporate Tax Matters 8. On facts of the case and in law, the Ld. AO/Ld. DRP erred in not allowing the claim of Rs.11

M/S Gujarat Guardian Ltd., New Delhi vs. DCIT, New Delhi

ITA 2539/DEL/2017[2005-06]Status: DisposedITAT Delhi16 Jul 2025AY 2005-06

Bench: Shri Prakash Chand Yadav & Shri Brajesh Kumar Singh

For Appellant: Shri Ajay Vohra, Sr. A.RFor Respondent: Shri Bhopal Singh, Sr. D.R

Section 92C

income with DCIT, Circle 12(1), New Delhi. Thereafter a reference was made by the AO to the ld. TPO to determine the ‘arm's length price' u/s 92CA (3) of the Act in respect of ‘international transactions' entered into by the assessee during the year under consideration. In response ... arm's length. 3.2 The TPO, however, in the order passed under section 92CA(3) of the Act determined the arm's length price of international transactions of export of float glass, applying CUP method as against the TNMM applied by the assessee, holding that in the case