Cost-to-cost reimbursement of seconded employees is not service consideration; transfer-pricing markup was deleted and amalgamation amortisation allow...
Crystallisation of liability supports prior-period expense deduction, while functionally distinct divisions require separate transfer-pricing benchmar...
Functional comparability under TNMM requires transaction-specific FAR analysis before benchmarking business-support services provided to associated en...
Advance pricing agreement methodology can guide benchmarking for non-covered years when functions, assets, risks and activities remain materially unch...
Tax-audit exemption for substantially State-funded educational universities prevents audit-failure penalties where income qualifies for statutory exem...
Functional, asset and risk analysis excludes diversified technology companies from captive software development comparables under cost-plus arrangemen...
Under the mercantile system, an accrued but unpaid obligation to share overflow profit with investors remains deductible where its nature and accrual are undisputed. Lack of funds at the close of the previous year does not by itself make the liability contingent. The obligation arose under the investor arrangement, had neither ceased nor failed to accrue, and was outside payment-based liabilities governed by section 43B. Its subsequent discharge further supported the conclusion that it was not contingent. Accordingly, disallowance of the accrued outstanding liability was unsustainable.
Under the mercantile system, an accrued but unpaid obligation to share overflow profit with investors remains deductible where its nature and accrual are undisputed. Lack of funds at the close of the previous year does not by itself make the liability contingent. The obligation arose under the investor arrangement, had neither ceased nor failed to accrue, and was outside payment-based liabilities governed by section 43B. Its subsequent discharge further supported the conclusion that it was not contingent. Accordingly, disallowance of the accrued outstanding liability was unsustainable.
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
TaxTMI 
of 4913 
