
40 | Chapter 5
be practical diculties in identifying comparable
transactions which are of independent nature.
While in manufacturing transactions, it is relative-
ly easy to compare the prices, but in research and
development transactions and in valuing intangi-
ble assets like patents and intellectual properties,
and in other technical goods and services, it is dif-
cult to apply the arm’s length principle. In the
Indian context, it is seen that in software industry
it becomes dicult to nd out comparable inde-
pendent transactions.
Avoiding Disclosure
Though there is an elaborate system of laws, rules
and regulations, and accounting standar ...