The TPO is charging notional interest on my overdue receivables from my associated enterprise. Can I argue for a 90-day credit period by analogy to the secondary adjustment repatriation window in s.92CE and Rule 10CB?
No, on this Tribunal's view. Section 92CE read with Rule 10CB operates only where a primary adjustment has been made in one of the specific situations the section lists, and the 90-day repatriation window attaches to that specific machinery; it cannot be borrowed as a general benchmark for the credit period allowable on outstanding receivables. The Tribunal instead directed the officer to adopt the credit period the TPO himself had adopted in the assessee's own case for the immediately preceding year that had reached the Tribunal.
Decided by the ITAT (Shri Ravish Sood, Judicial Member and Shri Madhusudan Sawdia, Accountant Member) on 2026-04-13, reported as ITA Nos. 1368 and 1369/Hyd/2025 (ITAT Hyderabad 'B' Bench), Assessment Years 2014-15 and 2015-16. It bears on section 92CE, section 92CE(2), section 92CB, section 92CA, section 92CA(3), section 143(3), section 144C, section 90, section 90A of the Income Tax Act 1961, in Assessment & Scrutiny and How Tax Law Is Read matters.
The secondary adjustment provisions are new enough that there is very little decided law on them, and the temptation to reason from them by analogy is strong. This order shuts that route down and is worth knowing before the argument is made and lost. It is also useful for what it records about the architecture of s.92CE: the section bites only where the primary adjustment arises in one of the enumerated ways — a suo motu adjustment in the return, an adjustment made by the officer and accepted by the assessee, an adjustment determined by an advance pricing agreement, an adjustment made under the safe harbour rules framed under s.92CB, or one arising from a mutual agreement procedure under s.90 or s.90A. On the substantive receivables point the Tribunal is on the Revenue's side of the line: it held that the allowable credit period is subjective and case-specific, that it cannot be settled by citing other cases, and that an assessee who has not challenged the credit period in earlier years may be taken to have accepted it.
Binding on the AO and CIT(A) within the Tribunal's jurisdiction. Persuasive elsewhere.
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The assessee, engaged in market research and data processing and formerly known as TNS India Pvt Ltd, filed a return for AY 2014-15 declaring Rs 45,75,17,450. The TPO's order under s.92CA(3) dated 31 October 2017 led to an assessment on 29 January 2018 determining income at Rs 76,32,86,548, the additions arising from the arm's length price of the assessee's international transactions with its associated enterprises, including notional interest on outstanding trade receivables computed at 7.5 per cent on the closing balance using the SBI term deposit rate. The Commissioner (Appeals) partly allowed the appeal, directing exclusion of eClerx Services Limited and Infosys BPO Limited as functionally dissimilar comparables, substitution of LIBOR plus 200 basis points for 7.5 per cent as the interest rate, and recomputation of interest on an invoice-by-invoice basis after allowing a credit period of 120 days. The Revenue appealed. On the credit period the assessee, through counsel, argued in the alternative that s.92CE(2) read with Rule 10CB(1) — under which excess money available with an associated enterprise following a primary adjustment is deemed an advance and must be repatriated on or before 90 days — showed that Parliament itself regarded 90 days as an acceptable threshold credit period, so that if 120 days were not accepted, 90 days should be.
The Revenue's appeals were partly allowed. On comparables and on the interest rate the Tribunal upheld the Commissioner (Appeals), following its own orders in the assessee's case for earlier years. On the credit period it set aside the 120-day direction and rejected the assessee's alternative argument based on s.92CE and Rule 10CB: those provisions contemplate a specific set of circumstances in which a primary adjustment gives rise to a secondary adjustment and excess money with the associated enterprise that must be repatriated within 90 days, and no analogy can be drawn from them to fix a 90-day credit period for computing interest on outstanding receivables under normal circumstances. The officer was directed to adopt the credit period the TPO had himself adopted in the assessee's own case for AY 2013-14 (paragraphs 16, 17 and 18 of the transcribed text).
The Tribunal set out what s.92CE requires: a secondary adjustment arises only where a primary adjustment to the transfer price is made in one of the enumerated ways — an adjustment made suo motu by the assessee in its return, an adjustment made by the Assessing Officer and accepted by the assessee, an adjustment determined by an advance pricing agreement, an adjustment made under the safe harbour rules framed under s.92CB, or one arising from the resolution of an assessment by mutual agreement procedure under an agreement entered into under s.90 or s.90A. It is only where such a primary adjustment produces an increase in total income or a reduction in loss that the excess money lying with the associated enterprise must be repatriated on or before 90 days. Because the 90-day period is attached to that specific machinery, it cannot be generalised into a credit period for ordinary trade receivables. On the credit period itself the Tribunal held that the question is subjective and turns on the facts of each case and cannot be decided summarily by reference to other decisions, disapproving the Commissioner (Appeals)'s reliance on OSI Systems Pvt Ltd and, through it, Value Labs Technologies. It drew an inference from the assessee's own litigation history: for AY 2007-08 to AY 2011-12 and for AY 2013-14 the assessee had challenged the rate of interest imputed by the TPO but had never challenged the credit period, which the Tribunal read as acceptance of the period the TPO had adopted, and it noted that the assessee's representatives had been directed to place the earlier TPO orders on record and had not done so.
We are unable to concur with the Ld. AR that an analogy can be drawn from the aforesaid conjoint reading of section 92CE r.w. Rule 10CBD, and it can safely be concluded that a credit period of 90 days for computing the interest on the outstanding receivables from the AE is to be allowed under normal circumstances.
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Handle my notice → Ask a CA on WhatsAppNo, on this Tribunal's view. Section 92CE read with Rule 10CB operates only where a primary adjustment has been made in one of the specific situations the section lists, and the 90-day repatriation window attaches to that specific machinery; it cannot be borrowed as a general benchmark for the credit period allowable on outstanding receivables. The Tribunal instead directed the officer to adopt the credit period the TPO himself had adopted in the assessee's own case for the immediately preceding year that had reached the Tribunal. This was decided by the ITAT (Shri Ravish Sood, Judicial Member and Shri Madhusudan Sawdia, Accountant Member) and bears on section 92CE, section 92CE(2), section 92CB, section 92CA, section 92CA(3), section 143(3), section 144C, section 90, section 90A of the Income Tax Act 1961. It is reported as ITA Nos. 1368 and 1369/Hyd/2025 (ITAT Hyderabad 'B' Bench), Assessment Years 2014-15 and 2015-16. The secondary adjustment provisions are new enough that there is very little decided law on them, and the temptation to reason from them by analogy is strong. This order shuts that route down and is worth knowing before the argument is made and lost. It is also useful for what it records about the architecture of s.92CE: the section bites only where the primary adjustment arises in one of the enumerated ways — a suo motu adjustment in the return, an adjustment made by the officer and accepted by the assessee, an adjustment determined by an advance pricing agreement, an adjustment made under the safe harbour rules framed under s.92CB, or one arising from a mutual agreement procedure under s.90 or s.90A. On the substantive receivables point the Tribunal is on the Revenue's side of the line: it held that the allowable credit period is subjective and case-specific, that it cannot be settled by citing other cases, and that an assessee who has not challenged the credit period in earlier years may be taken to have accepted it. If it applies to you, the first step is this: Do not run the Rule 10CB 90-day analogy as your primary case on credit period; run it, if at all, only as a stated alternative and expect it to be refused.
The assessee, engaged in market research and data processing and formerly known as TNS India Pvt Ltd, filed a return for AY 2014-15 declaring Rs 45,75,17,450. The TPO's order under s.92CA(3) dated 31 October 2017 led to an assessment on 29 January 2018 determining income at Rs 76,32,86,548, the additions arising from the arm's length price of the assessee's international transactions with its associated enterprises, including notional interest on outstanding trade receivables computed at 7.5 per cent on the closing balance using the SBI term deposit rate. The Commissioner (Appeals) partly allowed the appeal, directing exclusion of eClerx Services Limited and Infosys BPO Limited as functionally dissimilar comparables, substitution of LIBOR plus 200 basis points for 7.5 per cent as the interest rate, and recomputation of interest on an invoice-by-invoice basis after allowing a credit period of 120 days. The Revenue appealed. On the credit period the assessee, through counsel, argued in the alternative that s.92CE(2) read with Rule 10CB(1) — under which excess money available with an associated enterprise following a primary adjustment is deemed an advance and must be repatriated on or before 90 days — showed that Parliament itself regarded 90 days as an acceptable threshold credit period, so that if 120 days were not accepted, 90 days should be. The matter was decided on 2026-04-13 by the ITAT (Shri Ravish Sood, Judicial Member and Shri Madhusudan Sawdia, Accountant Member). On those facts the ITAT held as follows. The Revenue's appeals were partly allowed. On comparables and on the interest rate the Tribunal upheld the Commissioner (Appeals), following its own orders in the assessee's case for earlier years. On the credit period it set aside the 120-day direction and rejected the assessee's alternative argument based on s.92CE and Rule 10CB: those provisions contemplate a specific set of circumstances in which a primary adjustment gives rise to a secondary adjustment and excess money with the associated enterprise that must be repatriated within 90 days, and no analogy can be drawn from them to fix a 90-day credit period for computing interest on outstanding receivables under normal circumstances. The officer was directed to adopt the credit period the TPO had himself adopted in the assessee's own case for AY 2013-14 (paragraphs 16, 17 and 18 of the transcribed text).
The Tribunal set out what s.92CE requires: a secondary adjustment arises only where a primary adjustment to the transfer price is made in one of the enumerated ways — an adjustment made suo motu by the assessee in its return, an adjustment made by the Assessing Officer and accepted by the assessee, an adjustment determined by an advance pricing agreement, an adjustment made under the safe harbour rules framed under s.92CB, or one arising from the resolution of an assessment by mutual agreement procedure under an agreement entered into under s.90 or s.90A. It is only where such a primary adjustment produces an increase in total income or a reduction in loss that the excess money lying with the associated enterprise must be repatriated on or before 90 days. Because the 90-day period is attached to that specific machinery, it cannot be generalised into a credit period for ordinary trade receivables. On the credit period itself the Tribunal held that the question is subjective and turns on the facts of each case and cannot be decided summarily by reference to other decisions, disapproving the Commissioner (Appeals)'s reliance on OSI Systems Pvt Ltd and, through it, Value Labs Technologies. It drew an inference from the assessee's own litigation history: for AY 2007-08 to AY 2011-12 and for AY 2013-14 the assessee had challenged the rate of interest imputed by the TPO but had never challenged the credit period, which the Tribunal read as acceptance of the period the TPO had adopted, and it noted that the assessee's representatives had been directed to place the earlier TPO orders on record and had not done so. In the words reproduced by the source cited on this page: "We are unable to concur with the Ld. AR that an analogy can be drawn from the aforesaid conjoint reading of section 92CE r.w. Rule 10CBD, and it can safely be concluded that a credit period of 90 days for computing the interest on the outstanding receivables from the AE is to be allowed under normal circumstances." The decision followed or applied M/s. OSI Systems Pvt Ltd v. DCIT-16(2), Hyderabad, ITA No. 2228/Hyd/2017 — not followed on credit period; M/s. Value Labs Technologies v. ITO, ITA No. 1919/Hyd/2017 (5 April 2019) — not followed on credit period; Kantar GDC India Pvt Ltd (assessee's own case), ITA No. 2261/Hyd/2017 for AY 2013-14 (3 June 2024) — followed on interest rate and taken as the yardstick for credit period; DGS Technical Services Private Limited v. DCIT, Circle-8(1), Hyderabad, ITA No. 1095/Hyd/2024 (31 October 2025) — relied on by the Revenue.
It was decided by the ITAT on 2026-04-13 and is reported as ITA Nos. 1368 and 1369/Hyd/2025 (ITAT Hyderabad 'B' Bench), Assessment Years 2014-15 and 2015-16. Binding on the AO and CIT(A) within the Tribunal's jurisdiction. Persuasive elsewhere. A Tribunal decision binds the assessing officer and the Commissioner (Appeals) within that Tribunal's jurisdiction, and is persuasive before other benches. It is not binding on a High Court, and a contrary co-ordinate bench decision will be argued against you, so check whether the point has been taken the other way before you build a reply around it. On section 92CE, section 92CE(2), section 92CB, section 92CA, section 92CA(3), section 143(3), section 144C, section 90, section 90A, the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the department, and it appears in this library for that reason — you need to know what the Assessing Officer will cite against you. The Revenue's appeals were partly allowed. On comparables and on the interest rate the Tribunal upheld the Commissioner (Appeals), following its own orders in the assessee's case for earlier years. On the credit period it set aside the 120-day direction and rejected the assessee's alternative argument based on s.92CE and Rule 10CB: those provisions contemplate a specific set of circumstances in which a primary adjustment gives rise to a secondary adjustment and excess money with the associated enterprise that must be repatriated within 90 days, and no analogy can be drawn from them to fix a 90-day credit period for computing interest on outstanding receivables under normal circumstances. The officer was directed to adopt the credit period the TPO had himself adopted in the assessee's own case for AY 2013-14 (paragraphs 16, 17 and 18 of the transcribed text). It arises in Assessment & Scrutiny and How Tax Law Is Read matters, on section 92CE, section 92CE(2), section 92CB, section 92CA, section 92CA(3), section 143(3), section 144C, section 90, section 90A of the Income Tax Act 1961, and was decided by Shri Ravish Sood, Judicial Member and Shri Madhusudan Sawdia, Accountant Member. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. Argue the credit period on your own facts and your own contracts — the Tribunal's reason for refusing the analogy was that the period is subjective and depends on the facts of each case. Check what credit period the TPO allowed you in earlier years and whether you challenged it; silence in earlier years was read here as acceptance and became the yardstick for the year in dispute. If the Tribunal or the officer asks for the earlier TPO orders, file them — the assessee's representatives were directed to place the earlier orders on record here and had not done so by the date of pronouncement, and that told against them. Keep the s.92CE question separate: if a secondary adjustment is actually being made against you, test whether the primary adjustment falls within one of the enumerated situations at all, and whether the thresholds and the excluded assessment years apply.
Searched for later treatment; none was found. That is not the same as a source affirming it. The citator search (doc 58939823, confirmed as 'DCIT, Circle-2(1), Hyderabad vs Kantar GDC India Private Limited' decided 13 April, 2026) returns nothing. A second probe on the company name returned eighteen results including three Telangana High Court income-tax decisions, but all of them - 19 August 2024, 9 September 2024 and 26 March 2026 - pre-date this order, so none can be a review of it. The ninety-day period under s.92CE read with Rule 10CB as construed here has attracted no later treatment. Nothing overruling, doubting or distinguishing it was found, and no appeal to a High Court against it is disclosed on the record searched. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
Two cautions on the report. First, paragraph numbering differed between two retrievals of the same print URL: in the first the assessee's alternative contention was numbered 17 and the Tribunal's rejection 18, while in the second, which was a direct transcription, the rejection is numbered 17. The quote below is cited to the numbering of the transcription. Second, the passage as printed contains two evident slips: it describes an advance pricing agreement as 'entered into by the assessee under section 92CE' when the APA provision is s.92CC, and at one point writes 'Rule 10CBD' for Rule 10CB. Both are reproduced faithfully in the quotation and neither affects the reasoning. The order deals with two assessment years and the second appeal was decided by applying the first mutatis mutandis. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The Revenue's appeals were partly allowed. On comparables and on the interest rate the Tribunal upheld the Commissioner (Appeals), following its own orders in the assessee's case for earlier years. On the credit period it set aside the 120-day direction and rejected the assessee's alternative argument based on s.92CE and Rule 10CB: those provisions contemplate a specific set of circumstances in which a primary adjustment gives rise to a secondary adjustment and excess money with the associated enterprise that must be repatriated within 90 days, and no analogy can be drawn from them to fix a 90-day credit period for computing interest on outstanding receivables under normal circumstances. The officer was directed to adopt the credit period the TPO had himself adopted in the assessee's own case for AY 2013-14 (paragraphs 16, 17 and 18 of the transcribed text).
TaxSphere, “DCIT v Kantar GDC India Private Limited”, https://taxnotice.vittsphere.com/caselaw/case/kantar-gdc-india-92ce-rule-10cb-ninety-days/ (validity last checked 2026-09-08)
The judgment itself is a government work and may be quoted freely. The summary, the validity note and the reasoning on this page are this library's own writing: quote them with attribution, and please do not present either as the words of the court — this page keeps the two apart and so should a quotation of it.
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My primary adjustment stands and the money is still with my overseas associated enterprise. When exactly do my ninety days start, and at what rate is the deemed advance to be charged interest?
The TPO's order says I must now make a secondary adjustment. Which primary adjustments actually trigger s.92CE, and is there any threshold or year below which the section simply does not apply to me?
The TPO has re-characterised a payment to my associated enterprise as an interest-free loan and imputed notional interest on it, calling it a consequential adjustment. My year is well before 2016 and the underlying adjustment was itself deleted. Can he do that?
My associated enterprise will not send the money back. Can I simply pay tax on it and be done, and if I do, what do I give up?
