Transfer Pricing Laws


Transfer Pricing Regulation

The increasing participation of multi-national groups in economic activities in the country has given rise to new & complex issues emerging from transactions entered into between two or more enterprises belonging to the same multi-national group.

With a view to provide a detailed statutory framework which can lead to computation of reasonable, fair & equitable profits and tax in India, the Finance Act 2001 introduced the detailed Transfer Pricing Regulation (TPR) i.e. section 92 w.e.f. 1st April 2001.

The basic philosophy of the entire regulation is to ensure that taxes due by Indian entities in respect of transactions with its foreign associated enterprise ("FAE") are not evaded. Accordingly the entire mechanism revolves around "arm's length pricing" of these transactions i.e. to say that the profit that an Indian entity would have earned in these transactions if they were not with foreign associated enterprise are earned even when the transaction is with FAE.

Such regulation already exists in many developed countries and accordingly India is not the first country to introduce such regulations.

The topic is discussed under following heads and our team of experts would be pleased to answer any specific query that you may have. Feel free to connect with us on

Read full article


All the contents of article are only for general information or use. They do not constitute advice and should not be relied upon in making (or refraining from making) any decision. Kamdar Desai & Patel hereby excludes any warranty, express or implied, as to the quality, accuracy, timeliness, completeness, performance, fitness for a particular purpose of the Site or any of its contents, including (but not limited) to any financial tools contained within the article. Kamdar Desai & Patel will not be liable for any damages (including, without limitation, damages for loss of business projects, or loss of profits) arising in contract, tort or otherwise from the use of or inability to use this article, or any of its contents, or from any action taken (or refrained from being taken) as a result of using this article or any such contents. Kamdar Desai & Patel makes no warranty that the contents of the article are free from infection by viruses or anything else which has contaminating or destructive properties.

Sanjeev Kamdar

Hi, my name is Sanjeev Kamdar, Partner, KDP Accountants.

With an experience of over 33 years, I would be glad to help you with your requirements

Connect with me

KDP Accountants
Typically replies within an hour

KDP Accountants
for any career related enq, pl mail on
for any other query, pl connect with our experts