Safe Harbour Rules – Indian Transfer Pricing Regulations

Safe Harbour Rules - Indian Transfer Pricing Regulations

Home > Safe Harbour Rules – Indian Transfer Pricing Regulations

India’s Transfer Pricing Safe Harbour Regime: An Overview

Overview of the Indian Safe Harbour Regime

The Indian Safe Harbour Regime was established in response to escalating instances of transfer pricing audits and disputes. Introduced under the Finance (No.2) Act of 2009, effective from April 1, 2009, this regime was introduced vide Section 92CB of the Income Tax Act, 1961.
Under section 92CB, the determination of an arm’s length price, as defined by section 92C or Section 92CA, is required to adhere to safe harbour rules. These rules provide predefined acceptable ranges of profits or prices, enhancing certainty for transactions.
To provide greater advantages to taxpayers, the Central Board of Direct Taxes (CBDT) broadened the scope of Safe Harbour Rules through Rule 10TD of the Income-tax Rules. This expansion aims to streamline compliance procedures, encourage timely approvals, and reduce complexities associated with transfer pricing.
The Indian Safe Harbour Regime offers a structured and predictable framework that promotes compliance, minimizes disputes, and fosters a more harmonious business environment, ultimately contributing to a
more efficient and effective transfer pricing ecosystem.

Eligible Assessee

A person who has validly opted for safe harbour rules under Rule 10TE of the Income Tax Rules, 1962.

Eligible Transactions

These eligible transactions qualify for safe harbour treatment under Rule 10TB, providing a simplified and predictable transfer pricing framework.

The Rational Choice: Selecting the Safe Harbour Option

Advantages of Choosing the Safe Harbour Approach

Enhanced Certainty

By providing advance insight into the acceptable range of profits or prices that meet Safe Harbour criteria, transactions gain a heightened level of certainty, offering stakeholders a clearer financial landscape.

Conflict Mitigation

Safe Harbour serves as an effective dispute avoidance mechanism, significantly curbing the potential for conflicts between taxpayers and revenue authorities. This fosters a more harmonious business environment, particularly significant given the high incidence of Indian Transfer Pricing litigation.

Streamlined Approvals & Assessment

Safe Harbour Rules offer a structured mechanism for application and approvals procedures, facilitating a smoother and time-bound process. This stands in stark contrast to the prolonged timelines associated with Domestic Litigation or Advance Pricing Agreements (APAs).

Comparative Compliance

In contrast to the complexities involved in Advance Pricing Agreements (APAs) and the Domestic Transfer Pricing Litigation Route, Safe Harbour Rules present a more favorable choice in terms of TP/ALP rates/margins, timelines, and associated costs. This streamlined approach can alleviate compliance burdens.

Resource Efficiency

The adoption of Safe Harbour Rules translates into substantial savings in terms of time, costs, and efforts, especially in potential litigation scenarios. This strategic choice can lead to optimized resource allocation and more efficient business operations.

Stakeholder Confidence

Safe Harbour instills confidence in taxpayers through its predictable framework, enhancing investor confidence and fostering robust business growth.

Safeguarding Reputational Capital

Choosing the Safe Harbour route mitigates the risk of reputational damage that could arise from contentious transfer pricing disputes. A clean record in compliance can enhance a company’s standing within its Group and among stakeholders.

Incentive for Voluntary Compliance

The transparent and predictable nature of Safe Harbour can incentivize voluntary compliance, enabling companies to proactively meet their transfer pricing obligations and contribute positively to the overall tax ecosystem.

Core Features of the Safe Harbour Rules in India

Safe Harbour Rules in India: Key Points for Taxpayers

For those seeking to opt for safe harbour rules and who have undertaken in eligible international transactions, adherence to specific guidelines is imperative. Here’s a concise breakdown of the crucial aspects:

Filing Requirement

Taxpayers opting for safe harbour need to file an income return and safe harbour application (Form No 3CEFA) to the Assessing Officer, both before the stipulated deadline i.e., 30 November following the relevant FY.

Compliance Commitment

Even if opting for safe harbour, taxpayers must fulfill the prescribed transfer pricing documentation and maintain/Form 3CEB filing compliances (Rule 10TD(5) of the Rules).

Geographical Limitations

Safe harbour doesn’t apply to transactions with Associated Enterprises/Related Parties location in low or no tax countries.

Mutual Agreement Procedure (MAP)

If approved, the transfer price by the tax authorities for an eligible international transaction bars the assessee from invoking the Mutual Agreement Procedure in a double taxation avoidance agreement with a foreign entity.

Adjustment Constraints

When opting for safe harbour, comparability adjustments and prescribed variation/range benefits (tolerance band) aren’t accessible (Rule 10TD(4) of the Rules).

Duration of Choice

The option exercised remains in effect for a period as notified by the CBDT.

Transaction Scope

Safe harbour applies solely to specified transactions, while TP scrutiny exposure remains open to other transactions not eligible under safe harbour.

Deemed Acceptance

If the Assessing Officer, Transfer Pricing Officer, or the Commissioner, as the case may be, does not make a reference or pass an order within the specified time, then the option for safe harbor exercised by the assessee shall be treated as valid.

Scope of definitions

The scope of Operating Revenue and Operating Expense to be used in the computation of the Operating Margin has been clearly defined in the Safe Harbour Rules.

Indian Safe Harbour Rules – Latest Safe Harbour
Margins

Safe Harbour Procedure

How can SBC assist you?

Navigating the Safe Harbour Application process doesn’t have to be overwhelming. We’re here to provide discreet and effective assistance every step of the way.

SBC support:

We provide assistance in filing Form No. 3CEFA (Safe Harbour Application), ensuring a smooth process.
Our experts evaluate your eligibility for Safe Harbour Rules (SHR) by undertaking functional analysis and review of inter-company transactions and underlying agreements to guide your decision-making.
We conduct a comprehensive cost-benefit analysis to help you assess your options effectively.
If needed, we calculate year-end transfer pricing adjustments to align with safe harbour rates.
Our support extends to year-end compliance, including Form No. 3CEB and transfer pricing documentation.
We offer representation support before tax authorities (AO & TPO) for safe harbour proceedings.

CONTACT US

SBC TP Update - TP Compliances for NRs _2024

September 9, 2024June 27, 2026 bySBC

Transfer Pricing Compliances for Non Residents (NR) in India

Home > Transfer Pricing Compliances for Non Residents (NR) in India

Transfer Pricing Compliances applicable to NRs in India:

The clock is ticking, and Indian Transfer Pricing (“TP”) Compliances for the financial year 2023-24 are just around the corner, with due dates in Oct/Nov ’24.

Ensuring compliance with Indian transfer pricing regulations isn’t just a box to tick; it’s a strategic imperative. Non-compliance can result in serious repercussions with tax authorities. While many multinationals are abreast and carefully track the TP compliances of resident entities, there has been confusion or oversight regarding TP compliances applicable to a non-resident entity especially the associated enterprises (“AEs”) of Indian entities.

In this update, we have highlighted the applicability of Indian TP compliances for Non-Residents (“NR”) in India.

Applicability of TP Provisions to NRs

Section 92(1) of the Income Tax Act, 1961 (“IT Act”) (the primary section for the applicability of TP) provides that income arising from international transactions has to be at arm’s length price (“ALP”). Accordingly, Indian TP provisions would apply to NRs only when they enter into international transactions that give rise to taxable income in India.

If an NR has taxable income in India as per the provisions of the ITA from its AEs in the nature of services income, royalty/license fees, interest, sale/transfer of shares (capital gains), guarantee commission, etc., the NR has to comply with TP regulations in India.

ALP analysis from the standpoint of Indian resident AEs alone is not sufficient, as the TP regulations require even the NR AEs to substantiate the ALP for taxable international transactions.

TP Compliances for NR	Threshold for applicability	Due date	Penalty for non compliance
Accountants Report (Form No. 3CEB)	If International Transactions(irrespective of threshold) are undertaken with foreign Associated Enterprises (AEs). [Sec 92E (Form No. 3CEB) is applicable for all taxpayers including NR]	31st October	INR 1,00,000 [Sec 271BA is applicable to all taxpayers including NR]
Transfer Pricing Study Report	If aggregate value of International Transactions > INR 1 Crore. [Sec 92D & Rule 10D (TP Study) is applicable to NR having international transactions that gives rise to taxable income in India]	31st October	2% of value of international transactions [Sec 271AA(1) is applicable to all taxpayers including NR]
Master File (Form No. 3CEAA)	Part A is applicable if International Transactions are undertaken during the financial year (Part A is applicable to all MNEs irrespective of threshold) Part B is applicable if below twin conditions are satisfied: • Consolidated Group Revenue exceeds INR 500 Crores and • Aggregate value of all International Transactions exceeds INR 50 crores, or the Intangible Property related International Transactions exceeds INR 10 Crores [Sec 92D & Rule 10D (Form No. 3CEAA) is applicable for all taxpayers including NR]	30th November	INR 5,00,000 [Sec 271AA(2) is applicable to all taxpayers including NR]

Filing of Form No. 3CEB, maintenance of TP Study Report and Corporate Tax Return by NR

Income earned by NR	Form 3CEB & TP Report compliance requirement	Corporate Tax Return Requirement (“ROI”)
Taxable as per Income Tax Act & DTAA	To be reported in Form 3CEB & TP Study Report to be maintained (if value > INR 1 Crore)	Applicable unless TDS is deducted at rates given in Section 115A and there is no other income chargeable apart from incomes specified in Section 115A.
Taxable as per Income Tax Act but exempt as per DTAA	To be reported in Form 3CEB & TP Study Report to be maintained (if value > INR 1 Crore)	Applicable where DTAA benefit is opted by NR.
Not taxable as per Income Tax Act	Not to be reported (Can be disclosed in Form No. 3CEB out of abundant caution if there are any other taxable international transactions)	Not applicable
Other transactions of NR not impacting the taxable income	Not to be reported (Can be disclosed in Form No. 3CEB out of abundant caution if there are any other taxable international transactions)	Not applicable

TP compliances applicable even in case of ITR exemption	Filing of Master File (Form No. 3CEAA) by NR
❑ Section 115A provides an exemption to NRs from filing a Return of Income (ROI) when their total income consists of interest, dividends, FTS (Fees for Technical Services), and royalties, if tax has been deducted as per the rates provided therein. ❑ To claim such exemption, NR must not have any additional income that is assessable under the IT Act. ❑ However, there is no corresponding exemption in Sections 92E and 92D, and it would be advisable for NRs to comply with TP regulations to avoid penalties u/s 271BA and 271AA of the IT Act.	❑ The Central Board of Direct Taxes (“CBDT”), vide Notification No. 31/2021 dated April 5, 2021, amended Rule 10DA(4). ❑ As a result, if there are more than one resident as well as non-resident constituent entities, Form No. 3CEAA can be filed by any one designated constituent entity on behalf of all constituent entities. ❑ Accordingly, this redundant compliance burden on NRs is eased by the government.

Mitigating the Risk of Potential Litigation

❑ Under the Indian TP litigation mechanism, the Assessing Officer (AO) must refer the scrutiny of international or specified domestic transactions to a designated Transfer Pricing Officer (TPO).

❑ The CBDT, via Instruction No. 03/2016, provides guidelines on risk parameters for referring cases to TPOs.

❑ Cases are selected for scrutiny based on “TP risk parameters” through the Computer Aided Scrutiny Selection (CASS) system or the Compulsory Manual Selection Process.

❑ Cases under corporate tax scrutiny may also be selected for TP scrutiny based on Non-TP risk parameters, such as:

Non-filing of Form No. 3CEB or non-reporting of transactions in Form No. 3CEB.
TP adjustments of INR 10 crore or more in prior years, upheld by judicial authorities or pending in an appeal.
Findings related to TP matters in india from search, seizure, or survey operations.

❑ Non-Residents must ensure transfer pricing compliance to avoid scrutiny and penalties related to the non-filing of Form No. 3CEB in India.

Check Points for NR TP Compliance

Check Points	Explanation
Obtain PAN in India	When TP compliances are applicable, obtaining a PAN in India is crucial for electronic filings. For Non-Residents (NRs), obtaining a PAN through Form 49AA can be time-consuming, as it requires documents like the certificate of incorporation to be apostilled or attested by the Indian consulate or embassy abroad. It is advisable to initiate this process early to meet impending due dates.
Authorize Digital Signature Certificate (DSC) Holders in India	It is advisable to authorize a person holding a Digital Signature (DSC) in India by initiating a Power of Attorney (PoA), as electronic TP filings require digital signing. NR individuals acting as signatories for NR entities outside India may also consider obtaining a DSC depending on convenience.
Reliance on Available Documentation for TP Compliance	Since NR may not statutorily required to maintain books of accounts in India under any law, reliance should be placed on Form No. 26AS, invoices, agreements etc. Reliance can also be placed on documents, information and accounts maintained by the Indian AE with whom the NR AE has entered into international transaction.
Ensure Arm’s Length Price (ALP) Compliance	The Transfer Price should fall within the arm’s length range to meet the arm’s length requirements from the perspectives of both the Indian AE and NR AE, ensuring compliance from both sides.
Reconcile Form No. 3CEB with Form No. 26AS and Income Tax Return	Ensure that the value of international transactions reported in Form No. 3CEB matches with Form No. 26AS and the Income Tax Return to avoid scrutiny notices due to mismatches.
Report All Relevant International Transactions	Report all taxable international transactions and, where required, other international transactions as a precautionary measure to avoid penalties for failure to report qualifying international transactions.

Judicial Rulings in the context of NR TP Compliances

Case Law Reference	Important Observations
Content
Venenburg Group B.V. [2007] 289 ITR 464 (AAR)	Case Summary: The Authority for Advance Ruling (AAR) held that the applicant was not taxable in respect of capital gains on sale of shares held in its Indian subsidiary under the provisions of India Netherland Tax treaty. AAR held that since the provisions of the tax treaty were more beneficial to the assessee than provisions of the Act, the same were applicable to the assessee. Conclusion: The AAR further held that it was not necessary for the applicant to file tax return in India in the absence of tax liability in India and transfer pricing provisions under section 92 to 92F were not attracted in respect of the aforesaid transactions.
Praxair Pacific Ltd. [2010] 326 ITR 276 (AAR)	Case Summary: The assessee, a tax resident of Mauritius, proposed to transfer its holding in Indian company to its wholly owned Indian subsidiary. The AAR held that the transaction could not be regarded as ‘transfer’ in view of provision of section 47(iv). Further, the AAR also held that the transaction was not subject to capital gain tax in view of provisions of India Mauritius tax treaty. The AAR further held that provisions of section 115JB (MAT provisions) were not applicable to foreign company. Conclusion: The AAR also held that transfer pricing provisions were not applicable as income was not taxable in India.
Dow Agro Sciences Agricultural Products Ltd. [2016] 380 ITR 668 (AAR)	Case Summary: The applicant, a company, incorporated and registered in Mauritius, contends that its investment in Dow Agrosciences India (DAS India) is a capital asset. The Revenue argues about the existence of a Permanent Establishment (PE) in India, but the applicant has provided documents supporting no PE. The applicant reiterates that profits from the sale of equity shares of DAS India won’t be taxable in India due to the DTAA between India and Mauritius. Conclusion: Transfer pricing provisions (Sections 92 to 95) are not applicable if the transaction is not taxable in India. Since the proposed share transfer does not attract tax in India under the tax treaty’s Article 13, these provisions do not apply.
Goodyear Tire and Rubber Co. [2011] 334 ITR 69 (AAR)	Case Summary: In the facts of the given case, Goodyear Tire and Rubber Company USA, proposed to transfer its 74% shareholding in Goodyear India Limited (listed on BSE ) to its Singapore based subsidiary as ‘ Gift’ and at NIL value . Goodyear USA argued that since the full value of consideration received or accruing as a result of the transfer of shares was NIL, the mechanism to charge the capital gains to tax fails. The AAR upheld Goodyear’s contention and ruled that ‘It is settled law that Section 45 must be read with Section 48 and if the computation provision cannot be given effect to for any reason, the charge under Section 45 fails. Conclusion: The AAR further held that transfer pricing provisions under section 92 to 92F were not applicable to the facts of the case as the transaction was not taxable under Indian tax laws.
Vodafone India Services Pvt. Ltd. v. Union of India [2014] 368 ITR 1 (Bombay)	The Bombay High Court concluded that if ‘income’ is chargeable to tax under the normal provisions Of the Act, then alone Chapter X/transfer pricing provisions of the Act could be invoked. The Government of India vide Instruction No. 2/ 2015 dated 29.1.2015 has accepted the decision of the Bombay High Court in the case Of Vodafone Services Pvt. Ltd. According to the said instruction, the premium arising on issue of shares is a capital account transaction and does not give rise to income and hence not liable to transfer pricing adjustment.
Castleton Investment Limited. [2012] 348 ITR 537	Case Summary: The AAR held that transfer pricing provisions (Sections 92 to 92F) are applicable even if the income, such as capital gains, is exempt from taxation. In the case of Castleton Investment Limited, a Mauritius-based company, which held shares in an Indian listed company, the AAR determined that the provisions are considered machinery provisions. As such, capital gains cannot be determined without applying these sections. Whether the gain is ultimately taxable in India or not, the transfer pricing provisions would still apply if the transaction falls within their ambit. Conclusion: The applicability of Section 92 does not depend on chargeability under the Act. Thus, the AAR ruled that transfer pricing provisions would be applicable in this case of transferring investment to an associated enterprise in Singapore.
Armstrong World Industries Mauritius Multiconsult Ltd. [2012] 349 ITR 303 (AAR)	Case Summary: Armstrong World Industries Mauritius Multiconsult Ltd., a fully-owned subsidiary of Armstrong World Industries Ltd., UK (Armstrong UK) and a tax resident of Mauritius, intends to repurchase a portion of its shares from the applicant (holding 99.97% of shares) while the remaining shares (0.03%) are held by Armstrong UK. This proposed buyback is not liable to capital gains tax in India by virtue of the India-Mauritius. Conclusion: Thus, the AAR held that transfer pricing provisions would be applicable in the said case, taxpayer would be liable to comply with the Transfer Pricing provisions irrespective of whether the taxpayer earns any taxable income in India or not.
BNT Global Pvt. Ltd. v. ITO (ITA No. 4111/Mum/2016 dated 26 April 2017)	Case Summary: The taxpayer has not filed the audit report in Form 3CEB for its international transaction involving the receipt of foreign remittance from its Non-Resident Indian (NRI) Director, who was also a beneficial shareholder, in exchange for share capital and share premium within the company. Conclusion: The ITAT upheld the penalty under Section 271BA for the failure as the share issuance transaction fell within the ambit of Section 92E, requiring the filing of Form No. 3CEB. The reliance on the Vodafone India Services Pvt. Ltd. case was rejected, as it dealt with different facts and penalties.
Convergys Customer Management Group Inc. [MA NO. 261/Del/2020 I.T.A. No. 3529//DEL/2015 MA NO. 262/Del/2020 in I.T.A. No. 3530//DEL/2015]	Case Summary: Taxpayer only submitted Form 3CEB during the scrutiny and has not filed TP Study. Further, taxpayer did not disclose certain international transactions (of reimbursements, interest payments, FTS) on the premise that they are not subject to tax in India in accordance with the Treaty provisions. A categorical finding was given by the ITAT that every person has to maintain its own documents which taxpayer failed to and instead relied on its Indian subsidiary’s TP study. Conclusion: The ITAT upheld that Form 3CEB submission is not equivalent to TP documentation compliance u/s 92D while dismissing the Miscellaneous Application upholding levy of penalty u/s 271AA for non-maintenance of documents u/s 92D.
Without Prejudice
Commissioner of Wealth-tax v. Apar Ltd. [2002] 122 Taxman 631 (Bombay)	The term “without prejudice” was used to indicate to the Assessing Officer that filing a return and paying taxes should not impact the rights of the taxpayer. The taxpayer reserves the option to claim settlement as if the return was not filed under the Act. By filing the return “without prejudice,” the taxpayer denies liability to be assessed under the Act and implies the possibility of future rectification in accordance with the law. However, when any compliance is undertaken “without prejudice,” it must be clearly disclosed, along with relevant facts and justifications, in the documentation maintained by the non-resident and in Form No. 3CEB issued by the accountant.
On maintenance of separate transfer pricing documentation by non – residents
DCIT v. Convergys Customer Management Group Inc. [ITA No. 3529/DEL/2015 and ITA No. 3530/DEL/2015]	Case Summary: The ITAT imposed a penalty on Convergys Customer Management Group Inc., a US-based non-resident company, for not maintaining TP documents under Section 271AA of the Income Tax Act. The case involved its Indian subsidiary, Convergys India Services Pvt. Ltd., providing call center/back office support services. The Assessing Officer found a fixed place PE and Service PE in India with attributable profits, resulting in disallowances and penalties for not maintaining TP documents. Conclusion: In conclusion, the ITAT upheld the penalty imposed under Section 271AA of the Income Tax Act, stating that the CIT(A) was wrong in deleting the penalty.
On TP adjustments in hands of NR
Instrumentation Corporation Ltd., Finland v. ADIT [I.T.A. Nos. 1548 and 1549/Kol/2009]	Case Summary: Instrumentarium Corporation, a Finnish company (F Co.), provided an interest-free loan to its Indian subsidiary, Datex Ohmeda India Pvt. Ltd. (I Co.). The case revolved around whether the loan was at arm’s length and whether it eroded India’s tax base. Conclusion: The Assessing Officer argued that the transaction was not at arm’s length, resulting in an adjustment to the interest income of F Co. The company contended that applying transfer pricing provisions in this situation would lead to a reduction in the Indian tax base and increased losses for I Co., which could be carried forward and set off in subsequent years. The Income Tax Appellate Tribunal (ITAT) held that Section 92(3) of the Income Tax Act required assessing the impact on profits or losses for the year under consideration and for the taxpayer in question, rather than considering the impact on taxes in subsequent years. Thus, if the transaction was accepted without an arm’s length pricing adjustment, it would result in tax base erosion to the extent of the taxability of interest in the hands of F Co. The ITAT also rejected the argument that a corresponding deduction should be given to I Co.

Emphasis on Two-sided Transfer Pricing Analysis

❑ To satisfy the ALP test for both parties in a transaction, a two-sided comprehensive transfer pricing analysis is required.

❑ This analysis ensures that both the Indian AE and the NR AE meet the ALP standards.

❑ The transfer price must be set within an acceptable arm’s length range for both jurisdictions. The process is complex and time-consuming but is crucial to prevent double taxation and avoid tax disputes.

❑ The Kolkata Tribunal, in the landmark case of Instrumentarium Corporation Limited [I.T.A. Nos. 1548 and 1549/Kol/2009], emphasized the need for a two-sided TP analysis to determine the arm’s length price in both jurisdictions and mitigate risks of double taxation and tax disputes.

Conclusion

To successfully navigate the complex TP landscape in India, here’s what both residents and NRs should do:

❑ Ensure Compliance: It’s crucial for multinationals to diligently ensure compliance in India with applicable transfer pricing regulations for both resident and non-resident entities in India (i.e., filing all the relevant forms in India related to three-tiered documentation). Non-compliance could be viewed negatively by tax authorities.

❑ 360-Degree Analysis: It’s pertinent to ensure that the information disclosed in Form No. 3CEB, the local file, master file, and country-by-country report provides a comprehensive view and supports the transfer pricing and other tax positions of the multinational group. Applicability and filing of corporate tax returns should also be perused diligently.

❑ Robust Documentation: Remember, it’s not limited to filings alone. TP and tax filings should be backed up by the maintenance of robust supporting documentation to substantiate the TP positions and analysis in case of future audits/scrutiny by tax authorities.

In a nutshell, robust transfer pricing documentation and adherence to guidelines should be your top priority if you’re a multinational operating in India.

Disclaimer: This material and the information contained herein prepared by Steadfast Business Consulting LLP is intended for clients to provide updates and is not an exhaustive treatment of such subject. We are not, by means of this material, rendering any professional advice or services. It should not be relied upon as the sole basis for any decision which may affect you or your business. This Alert provides certain general information as well as specific information with respect to Steadfast Business Consulting LLP. This alert should neither be regarded as comprehensive not sufficient for the purposes of any decision-making.

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SBC Transfer Pricing

August 8, 2024June 27, 2026 bySBC

Indian Transfer Pricing Compliances

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Indian Transfer Pricing Compliances

Local File

TP compliance	Applicability	Due date	Penalty for non compliance
TP Study to be maintained u/s 92D	If aggregate value of International Transactions > INR 1 Crore or If Specified Domestic Transactions (SDT) > INR 20 Crores [transactions with entities/units claiming special tax holiday exemptions or deductions u/s 80IA or 80IB or 10AA or with entities claiming concessional tax rates of u/s 115BAB]	31 October 2024 (1 month prior to Tax Return filing due date)	2% of value of International Transactions or SDT
Form No. 3CEB Report by an Accountant u/s 92E	If International Transactions (irrespective of threshold) are undertaken with foreign Associated Enterprises (AEs) or If SDTs are undertaken with Indian AEs (either of the parties are claiming any tax holiday exemptions or concessional tax rates and the overall transactions value exceeds INR 20 Crores)	31 October 2024 (1 month prior to Tax Return filing due date)	INR 1,00,000

Master File

TP compliance	Applicability	Due date	Penalty for non compliance
Form No. 3CEAA (Part A) – Master File u/s 92D(4) (One Page Form)	Part A is applicable if International Transactions are undertaken during the financial year (Part A is applicable to all MNEs irrespective of threshold)	30 November 2024 (Same as Tax Return filing due date)	INR 5,00,000 Non furnishing of information and documentat ion
Form No. 3CEAA (Part B) – Master File u/s 92D(4) (Detailed Form)	Part B is applicable if below twin conditions are satisfied:- Consolidated Group Revenue exceeds INR 500 Crores and Aggregate value of all International Transactions exceeds INR 50 Crores or the Intangible Property related International Transactions exceeds INR 10 Crores	30 November 2024 (Same as Tax Return filing due date)	INR 5,00,000 Non furnishing of information and documentat ion
Form No. 3CEAB Master File Intimation u/s 92D(4) (One Page Form)	It is applicable to MNEs crossing the above Master File filing thresholds and having more than one entity operating in India	31 October 2024 (30 days prior to Master File filing due date)	INR 5,00,000 Non furnishing of information and documentat ion

Country-by-Country Report (CbCR)

TP compliance	Applicability	Due date	Penalty for non compliance
Form No. 3CEAD CbC Report u/s 286(2)/(4) (Detailed Form)	If Consolidated Group Revenue for preceding accounting year exceeds INR 6,400 Crores. However, if the bilateral exchange relationship for the automatic exchange of CbC Reports between tax authorities of Parent Entity/Alternate Reporting Entity (ARE) Jurisdiction and Indian jurisdiction is activated, then the Indian entity need not file CbCR in India as per Form No. 3CEAD. Indian entity is only required to file a CbCR Notification via Form No. 3CEAC. Link to check activated exchange relationships for CbCR https://www.oecd.org/tax/beps/country-by-country-exchange-relationships.htm	12 months from the Penalty for non compliance end of group’s accounting year 31 December 2024 (if Group’s accounting year is ending on 31 December 2023)	INR 5,00,000 – Furnishing of inaccurate information in CbCR INR5,000/15,000/ 50,000 per day – Non-furnishing of CbCR – Depending on the days of delay of violation
Form No 3CEAC CbCR Notification u/s 286(1) (One Page Form)	CbCR Notification is to be filed when Parent Entity/ ARE is filing CbCR in its respective jurisdiction and there is an automatic exchange of CbCR activated between Parent/ARE’s jurisdiction and the jurisdiction of Constituent entity i.e., India	10 months from the end of group’s accounting year 31 October 2024 (if Group’s accounting year is ending on 31 December 2023)	INR 5,00,000 – Furnishing of inaccurate information in CbCR INR5,000/15,000/ 50,000 per day – Non-furnishing of CbCR – Depending on the days of delay of violation

Other Important Tax Filings

Important Tax Compliances	Due Dates Applicable for Transfer Pricing Cases
Income Tax Return (ITR)	30 November 2024
Form No. 3CA/3CD – Tax Audit Report u/s 44AB	31 October 2024 (1 month prior to ITR due date)
Form No. 29B – Report u/s 115JB for certifying book profits computation	31 October 2024 (1 month prior to ITR due date)
Form No. 10ID – One time application u/s 115BAB(7) for exercise of concessional tax rate of 15% in case of new manufacturing domestic co’s	Before filing ITR which is due by 30 November 2024
Form No. 10IC – One time application u/s 115BAA(5) for exercise of concessional tax rate of 22% in case of domestic co’s	Before filing ITR which is due by 30 November 2024
Form No. 56F – Report u/s 10A/10AA for claiming tax exemptions/reliefs by FTZ/SEZ units/entities	31 October 2024 (1 month prior to ITR due date)
Form No. 56FF – Particulars to be furnished under clause (b) of sub-section (1B) of section 10A for claiming tax exemptions/reliefs by FTZ/SEZ units/entities	31 October 2024 (1 month prior to ITR due date)
Form No. 10CCB – Audit Report u/s 80I(7)/80IA(7)/80IB/80IC/80IE for claiming tax holiday deductions	31 October 2024 (1 month prior to ITR due date)
Form No. 10CCBBA – Audit Report u/s 80ID(3)(iv) for claiming deduction in respect of profits and gains from business of hotels and convention centres in specified area	31 October 2024 (1 month prior to ITR due date)
Form No. 10CCBC – Audit Report u/s 80-IB(11B) for claiming deduction in deduction in the case of an undertaking deriving profits from the business of operating and maintaining a hospital in a rural area	31 October 2024 (1 month prior to ITR due date)
Form No. 10DA – Report u/s 80JJAA – Additional employee deduction	31 October 2024 (1 month prior to ITR due date)
Form No. 67 – Statement for claiming Foreign Tax Credit (FTC)	On or Before end of AY i.e., 31 March 2025

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Transfer Pricing

Safe Harbour Rules – Indian Transfer Pricing Regulations

Safe Harbour Rules - Indian Transfer Pricing Regulations

India’s Transfer Pricing Safe Harbour Regime: An Overview

The Rational Choice: Selecting the Safe Harbour Option

Core Features of the Safe Harbour Rules in India