Tuesday, 29 November 2011

Transfer Pricing - Corporate Guarantee

In the unreported case  No. ITANo. 149/HYD/2010, Section 92B of the Income Tax Act, 1961 dated 9-9-2011 it was held that Corporate Guarantee provided in respect of AE is not an international transaction in terms of section 92B of the Income tax act, 1961.

The ITAT held that no guidelines are stipulated in respect of such transaction. unlike a bank or a financial institution, provision of corporate guarantee is incidental to the business of the taxpayer. In the absence of any charging provision, such transaction cannot be considered under transfer pricing.

No comments:

Bombay High Court Clarifies Tax Exemption Eligibility for Venture Capital Funds

  In a significant ruling, the Bombay High Court has reaffirmed that a Venture Capital Fund (VCF) registered with SEBI is entitled to claim ...