UPSC Prelims Practice Questions — CBDT signs record 219 Advance Pricing Agreements (APAs) in FY 2025–26, taking total number of APAs beyond milestone of 1000 (i.e. 1034) since inception

Question 1

Including the rollback provision, what is the maximum number of years of price certainty an Advance Pricing Agreement under the Income-tax Act, 1961 can provide to a taxpayer?

Accepted Answer

9 years

Answer

7 years

Answer

5 years

Answer

11 years

Question 2

In the context of the APA scheme, Section 92CD of the Income-tax Act, 1961 deals specifically with which one of the following?

Accepted Answer

Filing of a modified return of income to give effect to an APA already entered into

Answer

The power of the CBDT to enter into an APA with a taxpayer

Answer

The choice of the most appropriate method for determining the arm's length price

Answer

Imposition of penalty for failure to maintain transfer-pricing documentation

Question 3

Bilateral and Multilateral APAs are negotiated on India's behalf by its 'Competent Authority'. Which body discharges this function?

Accepted Answer

The Central Board of Direct Taxes (CBDT)

Answer

The Income Tax Appellate Tribunal (ITAT)

Answer

The Authority for Advance Rulings

Answer

The Dispute Resolution Panel

Question 4

The record 219 Advance Pricing Agreements signed in FY 2025-26 were entered into by the CBDT, which functions under which Union Ministry?

Accepted Answer

Ministry of Finance

Answer

Ministry of Corporate Affairs

Answer

Ministry of Commerce and Industry

Answer

Ministry of Law and Justice

Question 5

In FY 2025-26, the CBDT signed Bilateral APAs pursuant to Mutual Agreements with how many of India's treaty partners?

Accepted Answer

13

Answer

11

Answer

9

Answer

15

Question 6

How many methods are prescribed for the computation of the Arm's Length Price under Section 92C of the Income-tax Act, 1961 (read with the Income-tax Rules)?

Accepted Answer

Six

Answer

Four

Answer

Five

Answer

Three

Question 7

Since the inception of India's APA programme in 2012, which financial year recorded the highest-ever number of APAs signed in a single year?

Accepted Answer

FY 2025-26

Answer

FY 2023-24

Answer

FY 2022-23

Answer

FY 2024-25

UPSC Prelims Practice Questions — CBDT signs record 219 Advance Pricing Agreements (APAs) in FY 2025–26, taking total number of APAs beyond milestone of 1000 (i.e. 1034) since inception

Q1. Including the rollback provision, what is the maximum number of years of price certainty an Advance Pricing Agreement under the Income-tax Act, 1961 can provide to a taxpayer?

Q2. In the context of the APA scheme, Section 92CD of the Income-tax Act, 1961 deals specifically with which one of the following?

Q3. Bilateral and Multilateral APAs are negotiated on India's behalf by its 'Competent Authority'. Which body discharges this function?

Q4. The record 219 Advance Pricing Agreements signed in FY 2025-26 were entered into by the CBDT, which functions under which Union Ministry?

Q5. In FY 2025-26, the CBDT signed Bilateral APAs pursuant to Mutual Agreements with how many of India's treaty partners?

Q6. How many methods are prescribed for the computation of the Arm's Length Price under Section 92C of the Income-tax Act, 1961 (read with the Income-tax Rules)?

Q7. Since the inception of India's APA programme in 2012, which financial year recorded the highest-ever number of APAs signed in a single year?