Tribunal reinforces applicability of methods and rules on interest levy
July 20, 2010
Hasnain Shroff, Vinita Chakrabarti and Akash Arora discuss the Nimbus Communications Ltd Vs ACIT, Mumbai (ITA No.2361 (Mum.) of 2007) case and its implications for transfer pricing.
In the case the Mumbai Tribunal ruled that the arm’s length price can be determined using only one of the prescribed methods mandated under the Indian transfer pricing laws and that the rate of interest charged on loans is not a comparable for levying interest on outstanding receivables.
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