TNMM functional comparability requires reliable evidence of the...

TNMM functional comparability requires reliable evidence of the proposed comparable's activities during the relevant year. Entity-level margins of a diversified provider cannot support comparison with software development services where undated website descriptions and financial records do not establish segmental revenue or results; the comparable was excluded and the adjustment required recomputation, subject to the safe-harbour limit. Comparable margins must also be recomputed in line with DRP directions. For delayed foreign-currency receivables, arm's length interest cannot be fixed mechanically at a standard LIBOR spread; it requires analysis of the transaction, the associated enterprise's creditworthiness, and comparable uncontrolled rates. Domestic associated-enterprise receivables require verification before interest adjustment.