CBDT inks four new Advance Pricing Agreements in banking-manufacturing

New Delhi, Sept 5 (KNN) The Central Board of Direct Taxes (CBDT) has inked 4 more Advance Pricing Agreements (APAs) in the month of August making the total number of APAs to 175, an official release informed.

Out of the newly signed 4 Agreements, 3 agreements are unilateral and 1 is a bilateral. CBDT informed that the bilateral APA is for international transactions between an Indian company and a UK-based company. This is the 8th bilateral APA with the UK. Earlier 5 bilateral APAs were signed between India and Japan, thus making the number to 13 now.

The 4 new APAs signed recently pertain to various sectors of the economy including telecom, banking, manufacturing and education. The international transactions covered in these agreements include payment of royalty, provision of IT Services, Software Development Services. Also provision of manpower services, import of raw materials, export of finished goods are a part of the agreements.

With the new APAs signed, the total number of APAs have reached 175, this include 162 unilateral APAs and over 13 bilateral APAs.

The current financial year has over 23 APAs on board of which 1 is bilateral and 21 are unilateral.

The APA provisions were introduced in 2012 under the Income-tax Act. This was followed by the “Rollback” provisions of 2014. The APA scheme aims to provide certainty to taxpayers in the domain of transfer pricing by specifying the methods of pricing and setting the prices of international transactions in advance. (With PIB Inputs) (KNN/ DA)