Clarification on Profit Split Method by CBDT

Dated 05th July 2013

The Central Board of Direct Taxes had issued Circular No. 2 (hereinafter called “the Circular”) on 26 th March 2013 regarding application of Profit Split Method. However, vide Circular No:05/2013 dated:29/06/2013 the Central Board of Direct Taxes has withdrawn Circular No 2 dated 26 th March 2013 with immediate effect. Clarifying that: The Circular dt:26/03/2013 appeared to give the impression that there was a hierarchy among the six method listed in section 92C and that Profit Split Method (PSM) was the preferred method in the case involving unique intangible or in multiple interrelated international transactions.

SOURCE: GOVT. OF INDIA, Ministry of Finance


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