Transfer price query

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CA Ankith Jain (Querist)
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22 September 2016 Dear Experts, My query is regarding Transfer Price. Why we determine arm's length price from external source? The best way to determine arms length price could be the price charged to unrelated party, which is very simple then why do we need external source to compare? For example: One of our clients used to sell the goods to related as well as to unrelated party, in case of TP scrutiny, we compared the price to so many companies and then so much of analysis, rather my principal could have shown the invoice indicating price charged to unrelated party, that could have solved the problem in seconds, why we didn't did this?

Amol S Joglekar

Amol S Joglekar (Expert)
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23 September 2016 yes, you could have done that....this is one aspect
the second aspect is what the PEER company is doing in the same field....
So? Both should be considered. Isnt it?