Tolerance margin (+/-) 5% u/s 92C (2) available only where variation between ALP and Actual price limited to this range

Brief of the Case ITAT Ahmedabad held In the case of Lubrizol Advanced Materials India Pvt. Ltd. vs. DCIT that after the retrospective amendment to the second proviso to section 92C (2) by the Finance Act, 2012, there remains no ambiguity that the benefit of tolerance margin is available only when the variation between the arm’s length price as determined under section 92C (1) and the price at which the international transaction has actually been under taken does not exceed the tolerance margin. Once it exceeds the tolerance margin, no benefit under the proviso would be available to the ...