Section 80IA Income Tax Act | Internal CUP Method Is Most Appropriate For ALP Determination In Captive Power Transactions: Calcutta High Court

The Calcutta High Court has ruled that the "Internal CUP (Comparable Uncontrolled Price) method" is most appropriate for ALP (Arm's Length Price) determination in "captive power transactions" under Section 80IA of the Income Tax Act. Section 80IA provides deductions for certain industrial undertakings, including power generation. This decision provides crucial guidance on transfer pricing for internal transactions within a group, particularly for power generated and consumed captively. The Internal CUP method is preferred when comparable internal transactions exist, ensuring fair pricing for tax purposes.