. Basis of Determination of Price
Computation of Income from International Transactions shall be done having regard to arm’s length price as per section 92C where under six methods are prescribed namely :
(a) comparable uncontrolled price method;
(b) resale price method;
(b) cost plus method;
(c) profit split method;
(d) transactional net margin method;
(e) such other method as may be prescribed by the Board.
“Arm’s length price” means a price which is applied or proposed to be applied in a transaction between persons other than associated enterprises, in uncontrolled conditions. Section 14 of the Act provides for valuation of goods. Valuation of the such goods shall be deemed to be the price at which such goods or like goods are ordinarily sold or offered for sale for delivery at the time and place of importation or exportation, as the case may be, in the course of international trade where the seller and buyer have no interest in the business of each other and the price is the sole consideration for sale or offer for sale.
Rule 4(3) of Customs Valuation (Determina-tion of Price of Imported Goods) Rules, 1988 provides that where the seller and buyer are related to each other, the value shall be accepted provided that the examination of the circumstances of the sale of the imported goods indicates that the relationship did not influence the price.
However, Where the buyer and seller are related, the transaction value shall be accepted provided that the examination of the circumstances of the sale of the ...