The Tax Publishers2021 TaxPub(DT) 0144 (Hyd-Trib)

INCOME TAX ACT, 1961

Section 92C

Where TPO suggested ALP adjustment on account of interest-free working capital advances extended by assessee to its AE abroad and assessee contended that transactions were, in fact, investments in equity shares of AEs, issue was restored to TPO with direction to consider evidence filed by assessee to the effect that assessee had invested money in equity shares of its subsidiaries and had not given working capital advances.

Transfer pricing - Determination of ALP - Interest-free working capital advances extended to AE - Assessee pleaded transactions to be in the nature of investments in equity shares of AE's

TPO suggested ALP adjustment on account of interest-free working capital advances extended by assessee to its AE abroad. Assessee contended that transactions were in fact investments in equity shares of its AEs. Held: Issue was restored to TPO with direction to consider evidence filed by assessee to the effect that assessee had invested money in equity shares of its subsidiaries and had not given working capital advances and if it was found that transactions were, in fact, investments in equity shares of AEs, then no ALP adjustment would be made.

REFERRED :

FAVOUR : Matter remanded.

A.Y. : 2011-12


INCOME TAX ACT, 1961

Section 92B

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