Other statutory compliances
Maintenance of books of accounts & submission of reports:

Section 92CA gives powers to assessing officer to refer any case to transfer pricing officer. It also describes the procedure a transfer pricing officer should follow to complete the assessment.

Section 92D: This section provides that every person who has undertaken an international taxation shall keep and maintain prescribed information and documents. Such documentation inter alia includes

  • background information on the commercial environment in which the transaction has been entered into
  • Description & working of the method considered for determining ALP
  • Assumptions / adjustments /policies & price negotiations, which have critically effected the determination of ALP

Rule 10D (2) provides that in a case where the aggregate value of international trans-actions does not exceed Rs.1 Crore, it will not be obligatory for the assesse to maintain the above information and documents. Considering the wording of this Rule it appears that this limit will apply with reference to the aggregate value of the inter-national transactions with each associated enterprise and not with reference to the aggregate value of the international trans-actions with all associated enterprises during the financial year put together.

However, it is provided that in the above cases also the assessee will have to substantiate that the income arising from the inter-national transactions with associated enterprises, as disclosed by the accounts, is in accordance with S. 92. This will mean that, even if the aggregate value of the international transactions is less than Rs.1 Crore, the assessee will have to maintain adequate records and evidence to show that the international trans-actions with associated enterprises

Section 92E: Report from accountant

This section provides that every person who has entered into an IT during a previous year shall obtain a report from an accountant in prescribed form & submit the same to income tax authority before prescribed date.


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