Section 140A(3) of the Income Tax Act

Issuance of corporate guarantees does not constitute an international transaction under section 92B, particularly for guarantees provided before the 2012 amendment. Such guarantees are considered shareholder activities or quasi-capital and do not impact enterprise profits, income, losses, or assets.

Corporate guarantees cannot be considered international transactions for the purposes of Section 92B of the Income Tax Act, 1961.

Giving corporate guarantee for loans to associated enterprises is not an international transaction and amendments to Section 92B are not retrospective.

When calculating disallowances under the third limb of Rule 8D(2), only investments that have actually yielded exempt income in the current year should be considered. If the calculated disallowance is lower than the suo motu disallowance, the suo motu disallowance should be adopted.

A corporate guarantee is not considered an international transaction under section 92B of the Income-tax Act, particularly when considering the legislative amendment by the Finance Act, 2012.

The Arm's Length Price (ALP) of interest charged on a foreign currency loan and on delayed receivables from an associated enterprise (AE) is a key issue in transfer pricing. This case considered the determination of ALP for such transactions involving AEs.

Transfer pricing adjustments are estimations. When estimating corporate guarantee commission, it should be restricted to 0.5% if supported by data analysis, against higher figures computed by the Assessing Officer/Transfer Pricing Officer.