CMA Final · Direct Tax Laws and International Taxation · Transfer Pricing
During proceedings on a reference under section 166, the Transfer Pricing Officer notices an international transaction not included in the assessee's report under section 172 and not referred to him. What follows under section 166(5)?
The provisions apply as if the transaction had been referred to him under sub-section (1). The Transfer Pricing Officer can therefore determine its arm's length price without a fresh reference, even though it was not referred and was omitted from the section 172 report.
- AHe must ignore it, as it was not referred
- BHe must ask the Assessing Officer for a fresh reference with Commissioner approval
- CHe must report it to the Board without determining the price
- DChapter provisions apply as if that transaction had been referred to him under sub-section (1)Correct
Explanation
Section 166(5) covers transactions not referred, or not reported under section 172, that come to the Transfer Pricing Officer's notice during proceedings. The provisions then apply as if the transaction were referred under sub-section (1), so he can determine its price without a separate reference.
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