International Tax Knowledge Hub

This decision underscores the need for substantive facts demonstrating control, disposal, or authority to conclude contracts, not just the presence of contractual relationships or shared business interests..

The assessee is to be given a fair opportunity to submit relevant documentation and arguments to support its case..

Consequently, the assessee cannot be treated as an assessee in default under section 201(1) or made liable for interest under section 201(1A) for such payments..

The focus should remain on the economic substance and intent, not mere operational form or technicalities..

The Tribunal’s order mandates deletion of the addition and annuls the tax levied under Section 115BBE, directing the revenue authorities to accept the explanation supported by the documentary trail..

Assessees facing similar circumstances should vigilantly assert their rights under section 144C and challenge any premature final assessment orders..

This decision is actionable, requiring the AO to revisit the transfer pricing adjustment calculation in light of the revised comparables set..

Tax authorities are directed not to make transfer pricing adjustments on AMP expenses if the overall arm’s length analysis under TNMM has been accepted..

The TPO is thus directed to undertake a fresh ALP determination, adhering to the corroborative benchmarking analysis and ensuring that the computation of PLIs is accurately verified..

The Tribunal’s direction mandates that the CIT(A) now address the transfer pricing dispute regarding the guarantee commission on its substantive merits, rather than on procedural technicalities..