Arm's length principle prompts enhanced scrutiny of Indian agents of foreign suppliers and use of information-exchange measures. Assessing officers must scrutinise contracts between foreign principals and Indian agents to ascertain remuneration, services, and relationship, determine whether dealings are at arm's length for possible invocation of transfer-pricing provisions, refer incomplete contract information to the Directorate of Inspection through Commissioners, and employ investigative techniques including information exchange with treaty partners, search and seizure, and examination of investments and foreign travel to detect undeclared commissions and foreign exchange leakage.
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Provisions expressly mentioned in the judgment/order text.
Arm's length principle prompts enhanced scrutiny of Indian agents of foreign suppliers and use of information-exchange measures.
Assessing officers must scrutinise contracts between foreign principals and Indian agents to ascertain remuneration, services, and relationship, determine whether dealings are at arm's length for possible invocation of transfer-pricing provisions, refer incomplete contract information to the Directorate of Inspection through Commissioners, and employ investigative techniques including information exchange with treaty partners, search and seizure, and examination of investments and foreign travel to detect undeclared commissions and foreign exchange leakage.
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