ECONOMICS

Detailed explanation-1: -As per sub-section (2) of section 92D of the Income-tax Act, 1961 in compliance with Rule 10DA, the information and document in Form No. 3CEAA – Master File shall be furnished on or before the due date for furnishing the return of income as specified under section 139(1).

Detailed explanation-2: -Non-compliance Failure to furnish Master File could attract a penalty of INR 500, 000.

Detailed explanation-3: -A Local File is Transfer Pricing documentation already prepared in the local jurisdiction of a member of a Multinational Entity’s group. While the Master File provides an overview, the Local File is more detailed.

Detailed explanation-4: -Local file in India is currently same as the annual TP documentation which is required to be maintained (as per Rule 10 D) if the aggregate value of international transactions with the Associated Entities exceeds INR 10 million during the relevant financial year (INR 200 million in case of domestic transactions).