ECONOMICS

Detailed explanation-1: -3.1 TP Documentation/Local File: Section 92D(1) provides that every person who has undertaken an international transaction or specified domestic transaction shall keep and maintain such information and documents in respect of such transactions as may be prescribed.

Detailed explanation-2: -Transfer pricing methods are ways of establishing arm’s length prices or profits from transactions between associated enterprises. The transaction between related enterprises for which an arm’s length price is to be established is referred to as the controlled transaction.

Detailed explanation-3: -Transfer pricing is a technique used by multinational corporations to shift profits out of the countries where they operate and into tax havens. The technique involves a multinational selling itself goods and services at an artificially high price.