Indian Tribunal Holds Book Profits Not Subject to Transfer Pricing Adjustments for Minimum Alternate Tax Purposes

The Mumbai Income Tax Appellate Tribunal recently issued a decision on whether book profits may be increased by a transfer pricing adjustment for Minimum Alternate Tax (MAT) purposes. The case involved an Indian subsidiary of Owen Corning U.S., which in the 2007-08 tax year was involved in related party transactions for which it chose the transactional net margin method to determine the arm's length price. For the year concerned, the subsidiary filed its return and was subject to MAT on its b…