Master File CbCR in Bangalore | BEPS Action 13 three-tier documentation in Bangalore

A mid-sized Indian engineering company is acquired by a European group. The Indian CFO assumes the existing TP filings will roll forward unchanged, the local advisor confirms Form 3CEB will be filed as usual, and the next year passes without incident. Then the auditor flags that the European parent’s consolidated revenue crosses EUR 750 million, the Indian entity should have filed a Master File intimation, and there’s no CbCR notification on record. The first the Indian entity hears of the three-tier documentation framework is when the missed filings are picked up by the assessing officer two years later. Master File CbCR in Bangalore is the BEPS Action 13 architecture, and it operates on a separate calendar from the Local File. Companies that grow into the thresholds, or join groups that already cross them, often miss the change in their compliance position.

What Are the Three Tiers and Who Files What?

Local File. Maintained at the entity level. Required where the aggregate value of international transactions exceeds INR 1 crore. Contemporaneous documentation supporting Form 3CEB. Substantively the working file of the TP study described in the documentation blog.

Master File. Filed in Form 3CEAA under the 1962 Rules (Form 56 under the Income-tax Rules, 2026 from tax year 2026-27). Part A: filed by every constituent entity of an international group resident in India, regardless of thresholds. Captures basic group information, names and PANs of Indian constituent entities. Part B: filed only where consolidated group revenue exceeds INR 500 crore in the relevant accounting year AND the aggregate value of the international transactions exceeds INR 50 crore (or, for intangible property transactions, INR 10 crore). Captures the global organisational structure, business description, intangibles strategy, financial structure of the group, and the group’s transfer pricing policies. Master File Part B is the document the Indian tax authority uses to understand the group’s global value chain and assess whether Indian profits look right against the global picture. Due by the income tax return filing date for the relevant year.

Country-by-Country Report (CbCR). Filed in Form 3CEAD under the 1962 Rules (Form 59 under the 2026 Rules). Required where consolidated group revenue exceeds INR 6,400 crore (aligned with the OECD’s EUR 750 million threshold, raised from the earlier INR 5,500 crore in line with current exchange parity). Filed by the Ultimate Parent Entity or Alternate Reporting Entity. Where the parent is resident in another jurisdiction with an exchange agreement with India, the parent’s CbCR is shared with India automatically, the Indian entity files only an intimation in Form 3CEAC (Form 58 under the 2026 Rules). Where there’s no exchange agreement, or the parent’s jurisdiction has failed to share, the Indian entity may have to file the CbCR locally in Form 3CEAE.

Form 3CEAB (Form 57 under the 2026 Rules) is the inter-entity designation form. Where an Indian group has multiple constituent entities, one is designated to file the Master File on behalf of all Indian constituent entities. Master File CbCR in Bangalore runs on three forms, two thresholds, and a specific calendar.

What’s the Timeline and Who Misses What?

Master File Part A is due on or before the income tax return filing date for the relevant accounting year (typically 31 October for non-audited and 30 November for audited cases). Part B follows by 30 November. The inter-entity designation in Form 3CEAB must be filed at least 30 days before the Master File due date.

CbCR intimation (Form 3CEAC/58) is due at least two months before the CbCR filing due date. CbCR itself (Form 3CEAD/59) is due within 12 months from the end of the parent entity’s accounting year. So for a parent with a 31 March year-end, CbCR is due by 31 March of the following year, the intimation is due by 31 January of the following year.

Where the failures actually arise. Indian subsidiaries don’t track parent-group financials. Master File and CbCR thresholds turn on consolidated group revenue, which changes year to year. A company that wasn’t in scope last year may be in scope this year because the parent crossed the threshold, and no one in India is monitoring. The opposite also happens, where the parent dropped below threshold but India continues filing unnecessarily.

Confusion on responsibility. With multiple Indian constituent entities, the Master File and CbCR intimation need to be filed by a designated entity. Without an inter-entity agreement and a Form 3CEAB filing, each constituent entity may either assume someone else is filing or file separately, both of which create either non-compliance or duplication. Master File CbCR in Bangalore requires central coordination among Indian entities of the same global group.

What’s the Penalty Exposure and How Should Companies Manage It?

Section 271AA: penalty of INR 5,00,000 for failure to maintain or furnish Master File information, plus 2% of the value of the international transaction for failure to maintain local file documentation. Section 271GB: penalty for failure to furnish CbCR is INR 5,000 per day of default for the first month, INR 15,000 per day thereafter, escalating to INR 50,000 per day for continued failure after a penalty order. CbCR delays measured in months attract penalties in lakhs or crores.

Build the calendar around the consolidated group cycle, not the Indian financial year. The CbCR filing date is anchored to the parent’s accounting year, the intimation is two months before that. Companies should set up reminders against the parent’s calendar from the start.

Designate the Indian filing entity explicitly. Where there are multiple Indian constituent entities, the Form 3CEAB designation should be filed early in the year, not at the last minute. Once filed, the designated entity owns the Master File workstream for the year.

Track the consolidated group revenue annually. The thresholds are not static once-and-for-all determinations. Each year’s compliance position needs to be reassessed against the previous year’s consolidated group financials. A finance team that doesn’t see those numbers is operating blind on Master File CbCR in Bangalore.

Frequently Asked Questions

Q1. Does the Master File apply to an Indian-headquartered group with no international transactions?

The Master File obligation applies to constituent entities of an “international group”, which requires at least one foreign group entity. A purely domestic Indian group with no foreign constituent entities is outside the framework. Once a foreign entity is added (whether subsidiary, parent, or affiliate), the framework potentially engages, subject to thresholds.

Q2. What happens if the parent’s jurisdiction fails to share CbCR with India?

The Indian constituent entity becomes responsible for local filing of CbCR in Form 3CEAE (and equivalent under the 2026 Rules). Notification of the systemic failure is communicated by the tax authorities, but practical practice often requires the Indian entity to be proactive in identifying gaps.

Q3. Are Master File and CbCR information disclosed publicly?

Not in India. Master File and CbCR information is confidential between the tax administration and the taxpayer, exchanged under the OECD framework on a government-to-government basis. Public CbCR is operative in some EU jurisdictions but not in India.

Q4. Do the same thresholds apply to permanent establishments in India?

Yes, a foreign company’s permanent establishment in India is a constituent entity for these purposes if its accounts are included in the group’s consolidated financial statements. The PE is required to comply with the framework on the same basis as a separately incorporated Indian subsidiary. BEPS Action 13 three-tier documentation in Bangalore therefore remains relevant for qualifying permanent establishments and multinational groups operating in India.