What the courts have decided on section Rule 44G, in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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Harman Connected Services Corporation India Pvt Ltd v Joint Secretary
High CourtHelps taxpayerNo later treatment found
The competent authorities have settled your case under the mutual agreement procedure and the department still will not give effect to it. What order will the court make?
A mandatory one. The Karnataka High Court declared that the revenue authorities cannot defer implementing or giving effect to a MAP settlement, directed them to amend the assessment orders for all four years in conformity with it, to allow the refund with permissible interest under the prescribed procedure, and to complete the exercise within four months of receipt of a certified copy of the order.
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McDonald's Corporation v ACIT
ITATHelps taxpayerNo later treatment found
You are withdrawing your appeals because MAP has settled the issue. What do you ask the Tribunal for in case the department does not implement the resolution?
Ask for liberty to revive, and it will be given. The Delhi Bench permitted withdrawal of three appeals following a competent authority agreement under Article 27 of the India-United States treaty and dismissed them as withdrawn, but expressly with liberty to revive them again in the unlikely event that the MAP resolution is not given effect to, or if the dispute remains unresolved for any reason.
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Unilever Industries P. Ltd. v ACIT
ITATHelps taxpayerNo later treatment found
A bilateral APA signed years after the assessment fixes my margin for a run of years and MAP has settled the rest. What do I do with the appeals still pending for those years, and do my other grounds go with them?
The transfer pricing grounds go, the rest stay. Where a bilateral APA executed with both revenue authorities fixes the arm's length margin for the years under appeal and the MAP proceedings have been settled, the Tribunal allows the assessee to withdraw its transfer pricing grounds in compliance with Rule 44G and dismisses the Revenue's transfer pricing grounds as settled. The corporate tax grounds are decided on their merits in the same order.
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Mando Automotive India Pvt Ltd v ACIT
ITATCuts both waysNo later treatment found
Your MAP resolution settles the transactions with the treaty-country associated enterprise. Can the same treatment be claimed for your associated enterprises in other countries?
Not automatically, but the claim is arguable and the Tribunal will not shut it out. The Chennai Bench restored the adjustment on the transactions with the non-Korean associated enterprises to the Transfer Pricing Officer to examine whether they are similar in nature to those covered by the India-Korea MAP resolution, and, if they are found to be so, to consider giving them the same treatment as adopted in the MAP. The relief is a remand on a similarity test, not a direction to apply the agreed margin.
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ACIT v Raytheon Company
ITATCuts both waysNo later treatment found
Your MAP resolution has come through while cross appeals are pending before the Tribunal. What happens to the appeals, and who has to withdraw what?
Both sides withdraw. Where the competent authorities have resolved the issues arising in the appeals and the Board has communicated the resolution, the Tribunal will permit both the assessee and the Revenue to withdraw the grounds they have raised, so that the Revenue can give effect to the resolution under Rule 44G, and will dismiss the appeals. No issue is left to be decided on merits.
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ACIT v Rambus Chip Technologies (India) P. Ltd.
ITATHelps taxpayerNo later treatment found
My transfer pricing dispute has been settled under MAP and I want to withdraw my appeal. The department has its own cross-appeal before the Tribunal. Does that survive?
It does not. Once the transfer pricing adjustment that is the subject matter of both appeals has been resolved under the Mutual Agreement Procedure and the assessee is permitted to withdraw, the department's cross-appeal on the same adjustment has nothing left to bite on. The Tribunal dismissed both appeals.
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CBDT MAP Guidance 2022
CBDT Circulars & InstructionsCuts both waysNo later treatment found
You have a transfer pricing adjustment that also bites your associated enterprise abroad. Can you run MAP and the domestic appeal together, and what closes the MAP down?
You can run both. India follows a liberal regime and permits appeal and MAP proceedings to be pursued simultaneously, which many treaty partners do not. But a final ITAT order on the merits for the same year ends it: the competent authorities will not deviate from that order, the MAP is closed as resolved by a domestic remedy, and India then asks the treaty partner for correlative relief. Access is refused altogether in a defined set of cases, and there are fixed clocks for accepting a MAP outcome and for the officer to give effect to it.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.
