Transfer Pricing

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Amit Deokule (Querist)
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12 March 2009 Dear All,

URGENT!!! Please explain all questions in one statement possibly. Tell me practical aspect.

I have a query on Transfer Pricing-

If transfer pricing is to be applied for Pvt. Ltd. Software company-

What sort of possibilities are being taken into consideration?

Is a separate CA being appointed in this regard?

If turnover goes beyond 5 crores then is it applicable as oer I-T act, 1961?

As a matter of billability clause of Software projects, if we are keeping all agreements intact, then is it the only requirement or is it mandatory for Softex for STPI and as per I-T act to file the details?

How do we apply practically the one aspect out of seven in any company?

Regards,

Amit Deokule

chetan soni

chetan soni (Expert)
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13 March 2009 If transfer pricing is to be applied for Pvt. Ltd. Software company-
Ans: Yes it applicable, only if you have transaction with associate interprises as per sec 92 of income tax act.

What sort of possibilities are being taken into consideration?
Ans: you need to do the transactions as arms lenth prise again as per sec 92.

Is a separate CA being appointed in this regard?
Ans: No you don't need to appoint separate CA to do the transfer pricing audit.

If turnover goes beyond 5 crores then is it applicable as oer I-T act, 1961?
Ans: There is no such limit specify in income tax act.

As a matter of billability clause of Software projects, if we are keeping all agreements intact, then is it the only requirement or is it mandatory for Softex for STPI and as per I-T act to file the details?
Ans: Only getting the softex approved & submit the details is not enough. You need to get the transfer pricing audit done u/s92 & needs to submit the report in form 3CEB to income tax for getting the exemption u/s 10A.