ramesh (n/a) 01 June 2010

Section 92 C (2)

The Provisio of Section 92 C (2) defines

"....that where more than one price is determined by the most appropriate method, the arm's length price shall be taken to be the arithmetical mean of such price.................."

in the above what does it means by more than one price ?

Does it mean that more than one method of ALP ?
or does it mean that more than one comparable companies selected under any ALP method used?

Please advice

Many thanks

Regards

Ramesh

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Vineet (Director) 01 June 2010

Dear Mr Ramesh

As per provisions of section 92C(1), the ALP is to be determined appying the most appropriate method as per prescribed guidelines. The proviso to section 92C(2), talks about multiple ALP applying the most approriate method which can result only due to multiplicity of comparable instances such as companies, transations, margins etc. However in computing all these prices the most appropriate method remains identical.

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