TMI Blog2010 (10) TMI 21X X X X Extracts X X X X X X X X Extracts X X X X ..... en the related parties. - CBDT also asked to consider the issue - Petition (s) for Special Leave to Appeal (Civil) No(s). 18121/2007 - - - Dated:- 26-10-2010 - CORAM : HON'BLE THE CHIEF JUSTICE HON'BLE MR. JUSTICE K.S. RADHAKRISHNAN HON'BLE MR. JUSTICE SWATANTER KUMAR For Petitioner(s) Mr. Gopal Subramaniam,SG., Mr. V. Shekhar,Sr.Adv., Mr. Arijit Prasad,Adv., Ms. Pia Singh,Adv., Mr. Tanmay Mehta,Adv., Mr. H. Raghavendra Rao,Adv., Mr. B.V. Balaram Das,Adv. For Respondent(s) Mr. Ajay Vohra,Adv., Ms. Kavita Jha,Adv. O R D E R In this special leave petition, the key question which arose for determination before the Authorities below was, whether the assessee-Company and it's service provider [GSKCH] are related Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s a revenue neutral exercise, then the matter may be decided accordingly. We say no more in that regard. However, a larger issue is involved in this case. The main issue which needs to be addressed is, whether Transfer Pricing Regulations should be limited to cross-border transactions or whether the Transfer Pricing Regulations be extended to domestic transactions? In the case of domestic transactions, the under-invoicing of sales and over-invoicing of expenses ordinarily will be revenue neutral in nature, except in two circumstances having tax arbitrage-- [i] If one of the related Companies is loss making and the other is profit making and profit is shifted to the loss making concern; and [ii] If there are different rates for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f arm's length price, including the methods provided under Transfer Pricing Regulations. However, in number of matters, we find that, many a times, the Assessing Officer is constrained by non-maintenance of relevant documents by the taxpayers as, currently, there is no specific requirement for maintenance of documents or getting specific transfer pricing audit done by the taxpayers in respect of domestic transactions between the related parties. One of the suggestions which needs consideration is whether the law should be amended to make it compulsory for the taxpayer to maintain Books of Accounts and other documents on the lines prescribed under Rule 10D of the Income Tax Rules in respect of such domestic transactions and whether the taxpa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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