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Difference between market price and face value of equity shares issued to AE couldn't be treated as deemed loan

October 1, 2019[2019] 109 taxmann.com 136 (Mumbai - Trib.)

TRANSFER PRICING : Where assessee Indian company issued equity shares to its non-resident AE at lower price than its fair market value, difference between market price and face value of equity shares could not be treated as deemed loan to AE and, thus, TP addition made on account of notional interest on such deemed loan was to be deleted

TRANSFER PRICING : In case of assessee, engaged in providing investment advisory services' to its AE, companies engaged in merchant banking, could not be accepted as comparables

TRANSFER PRICING : Company engaged in portfolio management, mutual fund distribution and merchant banking services could not be accepted as comparable to assessee, an investment advisory service provider

TRANSFER PRICING : Company offering consultation services in area of strategy, risk management, operations improvement, etc., and whose main source of income was from consultation fee, was comparable to assessee, an investment advisory service provider

TRANSFER PRICING : Company providing various services to clients in financial market which were in nature of advisory services, was good comparable to assessee, an investment advisory service provider

TRANSFER PRICING : Where TPO rejected a comparable company selected by assessee, in view of fact that in assessee's own case in earlier assessment years such comparable company chosen by assessee was accepted, this company was to be accepted as comparable during year

TRANSFER PRICING : Where assessee, engaged in providing investment advisory services, itself selected a company as a comparable in its transfer pricing study report but in instant appeal before Tribunal assessee had objected to selection of this company on ground that its activities were in nature of investment banking service, matter was to be remanded regarding comparability of this company

TRANSFER PRICING : Where TPO applied export revenue filter of 75 per cent, merely because there was a small deviation in case of a comparable company as it earned 74.45 per cent of its revenue from exports, said company could not be excluded from list of comparables

TRANSFER PRICING : Where assessee's financial year was ending on 31st March, whereas, comparable company followed calendar year as its financial year, since from quarterly financial results, margin of comparable comapany could be easily computed for financial year 2008-09 by removing first quarter of year 2008 and including first quarter of year 2009, this company was to be accepted as a comparable

TRANSFER PRICING : Where assessee company conducted its business activities itself without outsourcing any part of it, a company which outsourced substantial portion of its work to third party, could not be accepted as comparable

TRANSFER PRICING : In case of assessee-company rendering support services in respect of MS Access database and MS Excel work sheets to its AE, a company providing geospatial services could not be accepted as comparable while determining ALP

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