Rule 123 - Maintenance and furnishing of information by constituent entity of an international group

Maintenance and furnishing of information and document by constituent entity of an international group under section 171. 123. (1) Every constituent entity of an international group shall keep and maintain information and documents where (a) the consolidated group revenue, as reflected in the consolidated financial statement of the international group for the accounting year, exceeds five hundred crore rupees; and (b) the aggregate value of international transactions during the accounting year, as per the books of account, exceeds fifty crore rupees (or ten crore rupees in the case of international transactions in respect of intangible property). The information and documents to be maintained include, among other things: a list of all the entities of the international group along with their addresses; a chart depicting the legal and ownership structure of the group; a description of the group's business, including the nature of the business, its profit drivers, a description of the supply chain for its five largest products or services and any other product or service contributing more than five per cent of group revenue, a description of important service arrangements, a description of the main geographic markets, a functional analysis of the principal contributors to value creation, and a description of important business restructuring transactions; a description of the group's overall strategy for development, ownership and exploitation of intangible property, including its research and development facilities and their location and management; a list of entities of the group involved in the development and management of intangible property; a list of important intangible property owned by the group and which entities own them; a list of important agreements among group entities related to intangible property; transfer pricing policies related to research and development and intangible property; a description of important transfers of interest in intangible property during the accounting year; a description of the group's financing arrangements, including arrangements with unrelated lenders, identification of entities providing central financing, and transfer pricing policies related to financing arrangements; the group's consolidated financial statement; and a list and brief description of the group's unilateral advance pricing agreements and other tax rulings relating to allocation of income among group entities. (2) The information and document referred to in sub-rule (1) shall be furnished to the Joint Director, as may be designated by the Director General of Income-tax (Systems), in Form No. 56, on or before the due date for furnishing the return of income specified under section 263(1). (3) Part A of Form No. 56 shall be furnished by every constituent entity of an international group, whether or not the conditions specified in sub-rule (1) are fulfilled. (4) Where there are multiple constituent entities of the same international group required to furnish the information and document under sub-rule (1), the group may designate one such entity to furnish the same on behalf of the other entities, by furnishing a notice in Form No. 57 to the Joint Director at least thirty days before the due date for furnishing such information and document. (5) The information and documents referred to in sub-rule (1) shall be retained for a period of nine years from the end of the relevant accounting year. (6) The rate of exchange for the calculation of the value in rupees of any figure expressed in foreign currency for the purposes of this rule shall be the telegraphic transfer buying rate of such currency, as defined in rule 207. (7) The expressions used in this rule and not defined shall have the meanings respectively assigned to them in section 511(10).