Arm's Length Price (ALP)

This discussion clarifies the concept of Arm's Length Price (ALP) in transfer pricing. It addresses a scenario where both the Comparable Uncontrolled Price (CUP) method and the Resale Price Method yield different ALP figures (1200 vs 1250). The consensus is to select the most appropriate method as per the Income Tax Act. If both appear suitable, one should be chosen with a clear justification provided to the Transfer Pricing Officer.