The Central Board of Direct Taxes ( CBDT ) has notified that the tolerance range of 1 per cent for wholesale trading and 3 per cent in all other cases for the assessment year 2019-20.
In a notification issued by Finance Ministry said 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.
“wholesale trading” means an international transaction or specified domestic transaction of trading in goods, which fulfils the following conditions, namely:-