CMA Final · Direct Tax Laws and International Taxation · Transfer Pricing
During proceedings on a referred transaction, the TPO finds another international transaction that the assessee did not include in its report under section 172 and that was not referred to him. What follows under section 166(5)?
The TPO can deal with it as though it had been referred to him. Section 166(5) provides that an unreferred transaction, or one omitted from the section 172 report, that comes to his notice during the proceedings is treated as referred under sub-section (1).
- AThe provisions of the Chapter apply as if that transaction had been referred to the TPO under sub-section (1)Correct
- BThe TPO must ignore it until the Assessing Officer refers it
- CThe transaction is exempt from arm's length pricing
- DThe TPO must send it to the Appellate Tribunal
Explanation
Section 166(5) covers a transaction not referred, or one not included in the section 172 report, that comes to the TPO's notice in the proceedings. The Chapter then applies as if it had been referred under sub-section (1), so the TPO can determine its price without a fresh reference.
Did you get it right without looking?
One question tells you little. A timed set on Transfer Pricing shows your real accuracy, how long you take and where you lose marks.
More Transfer Pricing questions
- A TPO makes a reference-based order for the tax year in which the assessment limitation period expires on 31 March 2028 under the Income-tax…
- For tax year 2026-27 the TPO determined an arm's length price under section 166(6) and the assessee validly exercised the option under secti…
- During proceedings on a reference for Transaction A, the TPO finds that the assessee also had international Transaction B, which was not ref…
- The TPO determined the arm's length price for an international transaction of Kaveri Auto Ltd for tax year 2026-27. Kaveri validly exercises…
- The Transfer Pricing Officer determined the arm's length price of a transaction for a tax year under section 166(6). Under section 166(9), w…
- For tax year 2027-28, the TPO declared valid an assessee's option under section 166(9) for a transaction. The Assessing Officer had also ref…