CBDT notifies tolerance range in transfer pricing for variation between arm’s length price u/s 92C

CBDT notifies tolerance range for wholesale trading and other cases for transfer pricing for variation between arm’s length price u/s 92C

Tolerance range for transfer pricing

MINISTRY OF FINANCE
(Department of Revenue)
New Delhi

Notification No. 64/2019- Income Tax

Dated: 13th September, 2019

S.O. 3272(E).—In exercise of the powers conferred by the third proviso to sub-section (2) of section 92C of the Income-tax Act, 1961 (43 of 1961)(hereinafter referred to as the ‘said Act’), read with proviso to sub-rule (7) of rule 10CA of the Income-tax Rules, 1962, the Central Government hereby notifies that where the variation between the arm’s length price determined under section 92C of the said Act and the price at which the international transaction or specified domestic transaction has actually been undertaken does not exceed one per cent. of the latter in respect of wholesale trading and three per cent. of the latter in all other cases, the price at which the international transaction or specified domestic transaction has actually been undertaken shall be deemed to be the arm’s length price for assessment year 2019-2020.

Explanation.- For the purposes of this notification, “wholesale trading” means an international transaction or specified domestic transaction of trading in goods, which fulfils the following conditions, namely:-

(i) purchase cost of finished goods is eighty per cent. or more of the total cost pertaining to such trading activities; and

(ii) average monthly closing inventory of such goods is ten per cent. or less of sales pertaining to such trading activities.

[F. No. 500/1/2014-APA-11]

NEHA NAUTIYAL, Under Secy.

Explanatory Memorandum

The notification provides for tolerance range of one per cent. for wholesale trading and three per cent. in all other cases for assessment year 2019-20. It is certified that none will be adversely affected by the retrospective effect being given to the notification.

Download CBDT Notification Click Here >>

• Non-deduction of TDS does not make transaction as unexplained in the hands of deductee – ITAT
• Last date to submit MEF 2026-27 extended to 09.09.2026
• Validity of demand u/s 156 for default u/s 115-O, if assessment order u/s 143(3) has Nil demand
• Issue already examined and adjudicated by CIT(Appeals), can’t be reopened on same set of facts
• TDS can’t be denied for non deposit of tax deducted by the deductor – High Court

addition u/s 68 addition u/s 69A ca misconduct cash deposit in bank cbdt circular CBDT Instruction cbdt notification cbdt order cbdt press release cgst circular cgst notification cit revision 263 concealment penalty condonation of delay covid-19 custom circular demonetisation due date extension e-way bill faq GST circular GST Council Meeting gst faq gstn advisory GSTR-3B GST rates IBBI ibc icai announcement income tax penalty itat ITAT Delhi mca circular MCA notification penalty 271(1)(c) penalty u/s 271(1)(c) Press Release reasons recorded reopening 148 Reopening us 147 Search & Seizure sebi circular unexplained cash credits validity of notice u/s 148 Withdrawal of 2000 500 Bank Notes