International Transactions Scrutinized: Transfer Pricing Dispute Resolved with Favorable Operating Profit Margin Analysis and Procedural Clarifications

ITAT adjudicated a transfer pricing dispute involving international transactions with affiliated entities. The tribunal upheld that interest on outstanding receivables constitutes an international transaction. After analyzing comparative margins, the bench found the assessee's operating profit margin of 31.59% superior to the comparables' mean of 14.30%, thereby rejecting transfer pricing adjustments. Regarding section 14A disallowance, ITAT directed the Assessing Officer to recompute disallowance based on average investment value. On TDS under section 194H, the tribunal affirmed CIT(A)'s order, determining no principal-agent relationship existed for guarantee commission payments, thus excluding TDS applicability. The revenue's appeal was partly allowed for statistical purposes. .....

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