These rules are relevant for the assessees who are having cross border transactions with related parties situated outside India. To be eligible, one has to qualify any of the below specified conditions as per Rule 10TB of Income Tax Rules, 1962 of Safe Harbor Rules:

1. be engaged in providing software development services or information technology enabled services or knowledge process outsourcing services, with insignificant risk, to a non-resident associated enterprise;
2. has made any intra-group loan;
3. has provided a corporate guarantee;
4. is engaged in providing contract research and development services relating to software development, with insignificant risk, to a foreign principal;
5. is engaged in providing contract research and development services relating to generic pharmaceutical drugs, with insignificant risk, to a foreign principal; or
6. is engaged in the manufacture and export of core or non-core auto components and where ninety per cent or more of total turnover during the relevant previous year is in the nature of original equipment manufacturer sales.
   
   In order to apply safe harbour rules, organisations have to carefully weigh the probability of litigation in the arm’s length approach, be aware of compliances required to be done under safe harbour rules and verify the eligibility conditions on their organisations.