TaxTMI 
TaxTMI 
2017 (5) TMI 719
X X X X Extracts X X X X
X X X X Extracts X X X X
....PM) as MAM even when there is no resale of Programmes by AE. The reasons given by him for doing so are wrong, contrary to the facts of the case and against the provisions of law. (ii) The Ld. CIT (A) erred in law and facts in upholding selection of AE as tested party to workout ALP applying RPM method. The reasons given by him for doing so are wrong, contrary to the facts of the case and against the provisions of law. (iii) The Ld. CIT (A) erred in law and facts in upholding addition of Rs. 24,91,59,200/- on account of alleged difference in ALP calculated as per RPM taking AE as tested party in relation to sales made to Associated Enterprises. The reasons given by him for doing so are wrong, contrary to the facts of the case and against provisions of law. (iv) The observations made by the Ld. Transfer Pricing Officer (TPO) for rejecting TNM Method and adopting RPM Method as MAM and recommending adjustment to income and confirming the same by the Ld. CIT (A) are misplaced, wrong, contrary to the facts of the case and based on assumptions, presumptions and surmises. (v) The Ld. CIT (A)/TPO/AO erred in law and facts in treating the telecasting of Programmes & Films and distri....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oing so are wrong, contrary to the facts of the case and against the provisions of law. (ii) The Ld. CIT (A)/TPO/AO ought to have appreciated that in the facts & circumstances of the case no guarantee was required by AE to take the loan and having given guarantee the assessee carrying no risk nor the AE is benefited by the guarantee issued to the bank hence no guarantee commission is chargeable nor Transfer Pricing adjustment warranted. (iii) The Ld. CIT (A)/TPO/AO ought to have accepted the facts that issuance of corporate guarantees by assessee to lender bank for its AE, does not involve any costs to the assessee, does not have any bearing on profits, income, losses or assets of assessee hence outside the ambit of expression 'international transaction'. 3. Disallowance u/s 14 A - Rs. 69,94,985/- (i) The Ld. CIT (A)/AO erred in law and facts in disallowing Rs. 41,44,060/- out of interest and Rs. 28,50,925/- out of expenses u/s 14 A of the Act. The reasons given by them for doing so are wrong, contrary to the facts of the case and against the provisions of law. (ii) The Ld. CIT(A)/AO erred in law and facts in disallowing interest relating it to investments ma....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... have allowed the crystallized & paid interest rate swap transaction loss in the normal course of business being expenditure of revenue in nature incurred for the business of the company allowable u/s 36 /37 of the Act. (iii) The Ld. CIT (A) wrongly relied on the Bombay HC decision in the case of Bharat Ruia Ltd (337 ITR 452), facts of which totally distinguishable as it is neither mark to market loss nor the loss on account of currency exchange fluctuation and interest rate swap is neither commodity nor it is purchase or sale of commodity or shares & securities settled otherwise than delivery. 6. The Ld. CIT (A) grossly erred in law and facts in dismissing the appeal by repeating the order of the TPO/ AO without considering & applying mind to the submissions of the assessee and denying justice to the appellant, thereby acted against the principles of natural justice." 3. Before we proceed to adjudicate the respective Grounds of appeal, a brief background of the case can be summarized as follows. The appellant is a company incorporated under the provisions of the Companies Act, 1956, and is, inter-alia, engaged in the business of broadcasting and distribution of TV Channel....
X X X X Extracts X X X X
X X X X Extracts X X X X
....icated sales based on negotiated prices. ATL, the associated enterprise had in-turn entered into agreements with Zee TV, USA and Asia TV, USA for distribution of programmes on channels via satellite and cable networks, for a fixed fee. Before the Transfer Pricing Officer, assessee pointed out that sale of TV programmes and films to the associated enterprise was benchmarked by applying the Transaction Net Margin Method (TNMM), and the Profit Level Indicator(PLI) was determined at 56.36% based on the formulae of Operating Profit/Operating Cost (OP/OC). It was asserted that since the margin of the selected comparables was 0.13%, the stated value of the international transaction of sale of T.V programmes and films was at an arm's length price. After considering the submissions and evidences relied upon by the assessee, the Transfer Pricing Officer has differed with the assessee on the determination of the arm's length price. Firstly, the Transfer Pricing Officer rejected the TNM Method selected by the assessee and instead he has selected the Resale Price Method (RPM) as most appropriate method in order to benchmark the international transaction of sale of programmes and films. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ecific reference to an observation made by the Transfer Pricing Officer in para 6.5 of the order that "the assessee has sold its programme at a throwaway price to its associated enterprise compared to the actual price of the product." It is contended that the said observation of the Transfer Pricing Officer is wrong and is in-fact contrary to the facts brought to his notice. It has been explained that the observation of the Transfer Pricing Officer is based on sales instances tabulated by him at the end of para 6.4 of his order. It is pointed out that the Transfer Pricing Officer has wrongly assumed that the instances of such sales are to the associated enterprises, whereas the correct position is that these are instances of sales made to the non-associated enterprises. The Ld. Representative for the assessee pointed out that even before the Transfer Pricing Officer, vide communication dated 14/10/2011, copy of which has been placed in the Paper Book at pages 115 to 126 it has been explained that if the Sale Price of the goods sold to non-associated enterprise is seen, then the Sale Price of the goods sold to associated enterprises is found to be higher. In this context, the Ld. Re....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... specific dispute, it would be appropriate to briefly recapitulate the relevant fact-situation. The assessee purchases as well as carries out an inhouse production of general entertainment programmes, current affairs and film rights for telecasting on its channels in India. Subsequent to such exploitation on Indian channels, assessee company exports/sells limited telecasting rights of such programme and films to its associated enterprise, ATL Mauritius for enabling the telecast of such products on the channels of its associated enterprise in the territories of UK, USA, Africa, Middle East, etc. The said transaction has been entered in terms of a Memorandum of Understanding dated 01/10/2005, copy of which has been placed in the Paper Book at pages 63 to 66. Thus, assessee has entered into an 'international transaction' within the meaning of section 92B of the Act with the its associated enterprise ATL Mauritius, for sale of rights of TV programmes and films, which were already exhibited on its TV channels in India. During the year under consideration, assessee has received a sum of Rs. 79,35,25,132/- as proceeds against the export/sale of TV programmes and films to ATL Mauritius. At....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e from the purchase and resale of the same or similar property or from obtaining and providing the same or similar services, in a comparable uncontrolled transaction, or a number of such transactions; (iii) the price so arrived at is further reduced by the expenses incurred by the enterprise in connection with the purchase of property or obtaining of services; (iv) the price so arrived at is adjusted to take into account the functional and other differences, including differences in accounting practices, if any, between the international transaction 55a[or the specified domestic transaction] and the comparable uncontrolled transactions, or between the enterprises entering into such transactions, which could materially affect the amount of gross profit margin in the open market; (v) the adjusted price arrived at under sub-clause (iv) is taken to be an arm's length price in respect of the purchase of the property or obtaining of the services by the enterprise from the associated enterprise;" 7.2 The first attack set-up by the appellant against the selection of RPM is that the same has been inappropriately applied by the Transfer Pricing Officer inasmuch as the transac....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he transactions have been viewed as dubious by the assessing authority. Therefore, in this background, the stand of the Transfer Pricing Officer in the instant year becomes suspect, and, in any case, it lends a heavy burden on the Transfer Pricing Officer to demonstrate the 'dubious' nature of the transactions. The moot point is whether such a burden has been discharged by the Transfer Pricing Officer? The discussion in the order of Transfer Pricing Officer reveals two reasons which have weighed with him to conclude that the transactions are dubious. Firstly, according to him, the programmes have been sold at 'throwaway prices' to the associated enterprise as compared to the actual cost of production. For this purpose, he has tabulated the Sale Price of certain T.V. Programmes in para 6.4 of his order. At the time of hearing, Ld. Representative for the assessee pointed out that the reference to such values was a misnomer, because they are prices at which TV programmes and films have been sold to non-associated enterprises. In support, he has referred to page 119 of the Paper Book which brings out that the sale rates are for sales made to non-associated enterprises. It is seen that ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....off in the first year itself against the revenues generated from the telecast in India. Thus, in our considered opinion, the Transfer Pricing Officer has not discharged his burden to demonstrate how the transaction with associate enterprise be considered as dubious. 7.5 The unsustainability of the approach of the Transfer Pricing Officer in selecting the RPM can also be gauged if one takes into consideration the provisions of Rule 10C of the Rules. As noted earlier, the computation of arm's length price under section 92C(1) of the Act is required to be made in terms of the most appropriate method prescribed therein. Sub-section (1) of section 92C of the Act also enumerates the methods prescribed and Rule 10C(1) of the Rules postulates that the most appropriate method shall be the method which is "best suited to the facts and circumstances of each particular international transaction", and which provides the "most reliable measure" of an arm's length price in relation to the international transaction. Sub-rule(2) of Rule 10C provides the factors which shall be taken into consideration while selecting the most appropriate method. Quite clearly, the entire discussion in the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....l Representative, the Transfer Pricing Officer was justified in rejecting the TNM method selected by the assessee. On this count, the Ld. Representative for the assessee pointed out that the observations of the Transfer Pricing Officer in this regard are contrary to the fact-situation. It is pointed out that assessee has maintained its documentation contemporaneously before the due date of filing of return of income as required as per Rule 10D(2) of the Rules and the prescribed report has also been certified by the Accountant in form No.3CEB. The Ld. Representative for the assessee explained that in the course of proceedings before the Transfer Pricing Officer there was certain delay in furnishing the requisite information, including the documentation and information required to be maintained as per Rule 10D(1) of the Rules, but the delay by itself cannot be interpreted to mean that the requisite information or documentation was not contemporaneously maintained. In this context, the Ld. Representative for the assessee has also referred to the Paper Book filed, wherein the requisite information, material and documentation required under Rule 10D(1) of the Rules has been placed. We f....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... were selected by the Transfer Pricing Officer for assessment year 2007-08 are taken as comparables for the instant year also, the transactions with ATL-Mauritius would still to be at arm's length price. All this goes to show that the Transfer Pricing Officer was fully aware of the manner in which the TNM method was applied by the assessee company and there is no adverse observations in this regard. The material on record, in our view, clearly belies the averment of the Revenue that the matter be restored back to the file of Transfer Pricing Officer for verifying the application of TNM method. Rather, in our view, the fact-situation clearly points to the contrary inasmuch as the assessee had fully explained its position in the course of proceedings before the Transfer Pricing Officer and no justifiable fault has been pointed out by the Transfer Pricing Officer; and, even before us the same position continues on behalf of the Revenue. Under these circumstances, in our view, the plea of the Ld. Departmental Representative is untenable and is hereby rejected. 7.8 In the final analysis, it is held that the action of the Transfer Pricing Officer in determining the transfer pricin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....fer Pricing Officer had erred in law and on facts in making an addition on account of commission/fee on corporate guarantee given to the associated enterprise. As per the assessee, considering the facts and circumstances of the case, and the financial capacity and net worth of the associated enterprise there was no risk assumed by the assessee in providing corporate guarantee to the bank for the loan taken by the associated enterprise. Alternatively, assessee contended that even if an adjustment was to be made, the arm's length rate would not exceed 1%, which was the rate charged by Barclays Bank to the associated enterprise, ATL-Mauritius for providing guarantee by way of letter of credit in assessment year 2005-06. However, the CIT(A) disagreed with the assessee and, he has affirmed the action of the Transfer Pricing Officer and accordingly, assessee is in further appeal before us. 8.2 Notably, as the orders of the lower authorities reveal, the principal plea of the assessee was that furnishing of a corporate guarantee on behalf of the associated enterprise is not to be construed as an 'international transaction' within the meaning of section 92B of the Act. Before us, the Ld.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ithin the meaning of section 92B of the Act and it has to be benchmarked separately based on the relevant FAR analysis. According to him, in the present case, assessee had itself made an alternate plea before the CIT(A) of 1% guarantee fee being charged by the bank and, therefore, the same may be treated as arm's length rate for the international transaction in question. 8.5 We have carefully considered the rival submissions. As observed by us earlier, the limited issue before us relates to the efficacy of the arm's length rate of 3% determined by income tax authorities on account of fee/commission for corporate guarantee provided on behalf of the associated enterprise. Factually speaking, in the present case, assessee company has issued corporate guarantee on behalf of its associated enterprise for the loan facility availed by it from the bank. The determination of arm's length commission/corporate guarantee fee @ 3% by the Transfer Pricing Officer is based on the fees charged by the banks. Quite clearly, the aforesaid approach of the income-tax authorities is inconsistent with the judgment of the Hon'ble Bombay High Court in the case of Everest Kanto Cylinders Ltd.(supra).....
X X X X Extracts X X X X
X X X X Extracts X X X X
....6 taxman.com 317 (Mum-Trib) (3) M/s. Godrej Household Products Ltd. vs. Addl. CIT, ITA No.7369/Mum/2010 order dated 22/11/2013 (4) ACIT vs. Nimbus Communications Ltd., ITA No.3664/Mum/2010 dated 12/06/2013. 8.6 Therefore, considering the entirety of facts and circumstances, we are inclined to uphold the rate of 0.5% for the purposes of determining arm's length rate of the corporate guarantee commission/fee. Thus, on this aspect, we set-aside the order of CIT(A) and direct the Assessing Officer to recompute the addition as per our aforesaid direction. Thus, on this aspect assessee partly succeeds. 9. The next ground of appeal is in respect of disallowance of Rs. 69,94,985/- sustained by the CIT(A) under section 14A of the Act. In this context, the relevant facts are that during the course of assessment proceedings, the Assessing Officer noted that assessee had made substantial investments in the shares of subsidiary companies and has also earned dividend income of Rs. 1,09,82,154/-, which was claimed as exempt income under the Act. Under these circumstances, the Assessing Officer show caused the assessee as to why expenses incurred in relation to the earning of the exemp....
X X X X Extracts X X X X
X X X X Extracts X X X X
....4A of the Act since assessee had sufficient owned funds to cover the investments and for this proposition reliance was placed on the judgment of the Hon'ble Bombay High Court in the case of Reliance Utilities & Power Ltd.(supra). The submissions of the assessee, which have been reproduced in the assessment order, also clearly establish that the owned interest-free funds of the assessee comprised of Share Capital and Reserves & Surplus amounting to Rs. 2128.24 crores, whereas the investments are to the tune of Rs. 60.12 crores. Even in the course of hearing before us, the Ld. Representative for the assessee has referred to the Paper Book to justify the aforesaid figures. There is no repudiation of the said factual matrix either before us or in the assessment proceedings and, therefore, following the ratio of the Hon'ble Bombay High Court in the case of Reliance Utilities & Power Ltd.(supra) it has to be presumed that the investments are out of own interest free funds. The said proposition is also applicable in the context of section 14A of the Act as held by the Hon'ble Bombay High Court in the case of HDFC Bank Ltd. vs. DCIT, 366 ITR 505(Bom). Therefore, considering the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....so required to furnish a bank guarantee of US dollars 60 million and accordingly, assessee had provided a bank guarantee of the aforesaid value, which was expiring on 12.4.2007. The agreement envisaged that the bank guarantee was renewable on a yearly basis during the first four years of the agreement. During the year under consideration, a dispute arose between the assessee and the BCCI and assessee did not renew the bank guarantee which expired on 12.4.2007. As a consequence, the BCCI terminated the agreement vide communication dated 31.5.2007 and 22.6.2007 and forfeited the advance deposit of US dollars 7,460,000 and replaced the assessee and granted media rights to a new broadcaster. The appellant-company considered the forfeited amount as irrecoverable and wrote-off the amount of advance of Rs. 33,54,01,600/- (i.e. USD 7,460,000) and claimed the same as an allowable revenue expenditure u/s 37(1) of the Act. The claim of assessee was on the ground that the said advance to BCCI was a business (trade) advance made in the ordinary course of business and hence its irrecoverability entitled the assessee to claim it as an allowable deduction u/s 37(1) of the Act. 10.1 On being sho....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n the nature of a 'capital asset' and, therefore, nonrecovery of such a deposit is a capital loss. The Assessing Officer also observed that the impugned advance was not a trade advance so as to be treated as a business loss. Accordingly, the Assessing Officer disallowed the claim of assessee and made an addition of Rs. 33,54,01,600/- to the returned income. The CIT(A) has sustained the addition for the reasons taken by the Assessing Officer. In addition, the CIT(A) observed that the write-off was approved by the Board of Directors of the assessee-company vide resolution dated 16.6.2008, a date which corresponds to the subsequent assessment year and, therefore, on this ground also the aforesaid claim of assessee was not allowable in the instant assessment year. 10.2 Against such a decision of the lower authorities, assessee is in further appeal before us. Before us, the learned representative for the assessee pointed out that in terms of clause 7.1 of agreement with BCCI, assessee had a right to re-negotiate the terms of the agreement in good faith in the light of any external developments and, therefore, in view of the change in governmental regulations, assessee had invoked the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....as charged to the Profit & Loss account for the year ending 31/03/2007 on account of the two matches having been played on 18th and 19th April, 2006. The balance amount of US dollars 74,60,000 was to be adjusted against the payment due for the last series in the fifth year of agreement. It transpires that BCCI terminated the arrangement vide communications dated 31/05/2007 and/or dated 22/06/2007 and the advance of Rs. 33,54,01,600/- was forfeited. Assessee company considered such forfeited amount of Rs. 33,54,01,600/- as an irrecoverable 'trade advance' made in the ordinary course of business and, thus, sought its deductibility in terms of section 37(1) of the Act. The Assessing Officer as well as CIT(A) have disallowed the claim on various counts. Firstly, as per the Assessing Officer the write-off was premature as assessee had not fully explored the possibility of its recovery. The Assessing Officer noted that Arbitration proceedings were initiated by the assessee, which were continuing and, therefore, it could not be said that the loss had actually crystallized during the year under consideration. Secondly, as per the Assessing Officer, the payment was for acquiring media right....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ecision to seek renegotiation of the terms and conditions of the media rights with BCCI as according to the assessee such developments would have impacted its income from the arrangement. It transpires that in terms of the requirement of media right agreement dated 12/04/2006, assessee was required to provide bank guarantee of US dollars 60 million to the BCCI, which was renewable on the yearly basis. Pending renegotiation, assessee did not renew the bank guarantee, which expired on 12/04/2007. BCCI viewed such non-renewal of the bank guarantee as a violation of the terms and conditions of the agreement and accordingly, invoked the termination clause and terminated the agreement and granted media rights to new broadcaster. BCCI also forfeited the advance of US dollars 74,60,000 lying with it. Assessee approached the BCCI, filed a legal case for recovery and also initiated arbitration proceedings, so however, assessee did not visualize any sign of recovery and, therefore, it wrote-off the forfeited amount (i.e. Rs. 33,54,01,600/-) and claimed it as a deduction. Factually speaking, the loss of Rs. 33,54,01,600/- suffered by the assessee is not in dispute inasmuch as there is no averm....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nt of musical album which was abandoned was not considered by the Tribunal to be a capital loss in assessment year 1998-99 vide its order in ITA No.2233/Mum/2010 dated 23/12/2011. Similarly, reliance has also been placed on the decision of the Tribunal in the assessee's sister concern, M/s. Zee Media Corporation Ltd. in ITA No.1590/Mum/2015 dated 12/08/2015, wherein also similar payments have been considered on revenue account and not capital in nature. In our considered opinion, the aforesaid precedents support the case of the assessee that the impugned loss was not capital in nature. Moreover, it is pertinent to observe that in the assessment year 2007-08 assessee has asserted that part of the amount paid to BCCI has been debited in the Profit and Loss account and there is no dispute on this count. In this background, in our view, the plea of the Assessing Officer to say that the impugned loss was capital in nature is not tenable. At this stage, it may also be relevant to mention that the Assessing Officer has only made a bald assertion and not given reason to justify as to why the acquisition of media rights in terms of the agreement dated 12/04/2006 has to be treated as capital....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f 0.1% in the Libor rate while if there was an appreciation in Euro beyond the agreed exchange ratio, the Appellant would pay additional interest". In effect, what the assessee did was to change its exposure from fixed interest cash outflow in USD to floating interest cash outflow and also intended to benefit from favourable movement in the price of dollar. On the monthly basis, the interest cash flows receivable and payable were netted of between the assessee and the bank and such arrangement was to continue until the discharge of bond liability. Neither party to the arrangement had a right to receive or an obligation to pay the aforestated notional principal, which was only a means to calculate interest outflows on each settlement date. In the previous year relevant to the assessment year under consideration, on account of adverse movements in Libor and/or USD/Euro exchange rates, assessee incurred a loss of Rs. 26,16,92,712/-. In this background, assessee submitted that the said loss arising on account of adverse movement of Libor/USD/Euro exchange rates is not a transaction falling within the meaning of section 43(5) of the Act so as to be treated as speculative in nature. A....
X X X X Extracts X X X X
X X X X Extracts X X X X
....l within the purview of section 43(5) of the Act. The Ld. CIT-DR emphasized that whereas the Hon'ble High Court was dealing with the Exchange-Traded-Derivatives (ETD), the impugned arrangement of interest rate swap is in the nature of Over-The- Counter (OTC) derivatives, which are traded directly between the parties. According to him, the trading in OTC derivatives is permitted by the respective Regulatory bodies and in this context, contended that such trading in OTC mode has been permitted by the Reserve Bank of India, which is the relevant Regulatory Authority in this regard. It was, therefore, explained that the ratio of the judgment of the Hon'ble Bombay High Court in the case of Bharat R. Ruia(HUF)(supra) is fully attracted even to such transactions because primarily the transactions are not based on actual delivery and, therefore, the same are speculative in nature. 11.4 We have carefully considered the rival submissions. In so far as factual aspect is concerned, we are dealing with the transaction of interest rate swap, which essentially is an interest rate agreement with the bank, in which the two parties agree to exchange interest rate cash flows based on a spe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....deemed to be a speculative transaction. Explanation 1.-For the purposes of clause (d), the expressions- (i) "eligible transaction" means any transaction,- (A) carried out electronically on screen-based systems through a stock broker or sub-broker or such other intermediary registered under section 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992) in accordance with the provisions of the Securities Contracts (Regulation) Act, 1956 (42 of 1956) or the Securities and Exchange Board of India Act, 1992 (15 of 1992) or the Depositories Act, 1996 (22 of 1996) and the rules, regulations or bye-laws made or directions issued under those Acts or by banks or mutual funds on a recognised stock exchange; and (B) which is supported by a time stamped contract note issued by such stock broker or sub-broker or such other intermediary to every client indicating in the contract note the unique client identity number allotted under any Act referred to in sub-clause (A) and permanent account number allotted under this Act; (ii) "recognised stock exchange" means a recognised stock exchange as referred to in clause (f) of section 2 of the Securities Contracts (Regulat....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... purchase of shares of certain companies at specified future date and at a specified price, which were to be settled in cash without actual delivery of the shares. The issue before the Hon'ble Bombay High Court was whether such a contract constituted a contract for the purchase of commodity within the meaning of section 43(5) of the Act. As per the Hon'ble Bombay High Court the future contract being articles of trade and commerce, which are legally permitted to be traded on the stock exchange would be a transaction in a commodity as contemplated under section 43(5) of the Act. Therefore, the loss incurred in such a transaction was held to be falling for consideration as a speculative transaction within the meaning of section 43(5) of the Act. In coming to such conclusion, the Hon'ble High Court noted that the transaction involved trading in underlying security/derivates, which was tradable on the stock exchange. Thus, coming back to the instant case, in order to treat the impugned interest rate swap arrangement to be 'speculative' in terms of section 43(5) of the Act, the Revenue would have to demonstrate that an interest rate swap arrangement was a tradable commodity. This....