The Classic Partners LLP

Transfer Pricing Assessment

When your case is referred to the Transfer Pricing Officer under Section 92CA, the quality of your documentation and representation decides the adjustment. We manage the entire TP assessment lifecycle.

Defend Your TP Assessment

How a TP Assessment Unfolds

Reference to the TPO (Section 92CA): the Assessing Officer, with approval, refers the international/specified domestic transactions to the Transfer Pricing Officer.
Notices and questionnaires: the TPO calls for the Rule 10D documentation, TP study, agreements, and segmental financials.
Show-cause and fresh search: the TPO may run an independent comparable search and propose an adjustment by show-cause notice.
TPO order: the determined ALP is binding on the AO, who incorporates it in a draft assessment order for eligible assessees.
Next forum: objections before the DRP or appeal via CIT(A)/ITAT.

Frequent Adjustment Battlegrounds

Rejection of the taxpayer's comparables and substitution with high-margin sets.
Re-characterisation of routine entities as bearing entrepreneurial risk.
Intra-group services questioned on the benefit and evidence test.
Notional additions for corporate guarantees, interest on receivables, and AMP expenditure.
Use of single-year data or wrong PLI against the taxpayer's multiple-year analysis.

Consequences of an Adjustment

Addition to income with consequential interest, and penalty exposure on under-reported income.
Secondary adjustment (Section 92CE): the excess money must be repatriated to India, failing which deemed interest accrues (or a one-time additional tax is paid).
Repetition risk in later years — making the first-year defence, or the multi-year ALP option, strategically critical.

Our Assessment Defence

Submission Management

Complete, consistent replies to every TPO notice and questionnaire.

Counter-Benchmarking

Rebuttal searches and screens — see benchmarking analysis.

Show-Cause Replies

Economic and legal rebuttals to proposed adjustments.

Hearing Representation

Appearance before the TPO and AO through to the order.

Secondary Adjustment

Section 92CE computations and repatriation compliance.

Forum Strategy

DRP or appeal route planning the day the order lands.

Frequently Asked Questions

What is a reference to the TPO under Section 92CA?

The Assessing Officer, with prior approval, refers the taxpayer's international and specified domestic transactions to the Transfer Pricing Officer, who determines the arm's length price; the TPO's order is binding on the AO.

What documents does the TPO typically demand?

The Rule 10D documentation, transfer pricing study, intercompany agreements, segmental profitability, invoices and evidence of services received, and details of the comparable search process.

What happens after the TPO passes an order?

The AO incorporates the adjustment in a draft assessment order for eligible assessees, who may object before the DRP within 30 days, or in other cases passes the final order appealable before the CIT(A).

What is secondary adjustment under Section 92CE?

Where a primary TP adjustment exceeds the prescribed threshold, the equivalent funds must be brought into India within the stipulated time; otherwise notional interest is taxed yearly, unless the taxpayer opts to pay a one-time additional tax.

Can good documentation really reduce the adjustment?

Yes. Contemporaneous Rule 10D documentation shifts the burden, restricts the TPO's ability to discard the taxpayer's analysis, and protects against the 2% documentation penalties — it is the single biggest determinant of assessment outcomes.

TPO notice on your desk?

Respond with economics, evidence, and strategy — engage our assessment defence team today.