This article analyses the judgment of the Delhi High Court regarding the constitutionality of Instruction 3 of 20 May 2003 of the Central Board of Direct Taxes, which required that reference be made to the transfer pricing officer when determining the arm's length consideration if the aggregate value of a taxpayer's international transactions exceeds INR 50 million. Ambiguities which have arisen due to this judgment are considered, as well as recent attempts by the legislature to correct these problems and the ramifications of those legislative corrections.