TaxTMI 
TaxTMI 
2021 (12) TMI 1440
X X X X Extracts X X X X
X X X X Extracts X X X X
....(P) Ltd. All other relevant details thereof reads as follows: S.No A.Y & ITA No Order under challenge Proceedings u/s 1 2011-12 149/Hyd/2017 Dy.CIT Circle 16(2) vs. Maanaveeya Dev. & Finance Private Ltd 143(3) r.w.s 92CA (3) 2 2011-12 134/Hyd/2017 Maanaveeya Dev. & Finance Private Ltd vs. ACIT, Circle 16(2) -do- 3 2012-13 565/Hyd/2017 Maanaveeya Dev. & Finance Private Ltd vs. DCIT, Circle 16(2) 143(3) r.w.s 92CA (3) rws 144C(5) 4 2013-14 1507/Hyd/2018 -do- 143(3) rws 92CA 5 2013-14 1506/Hyd/2018 Dy.CIT Circle 16(2) vs. Maanaveeya Dev. & Finance Private Ltd -do- 6 2014-15 1811/Hyd/2018 -do- 143(3)rws 92CA3 7 2014-15 1582/Hyd/2....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ompulsory convertible debentures involve domestic currency only which had been rightly benchmarked in the light of the domestic prime lending rate at the relevant point of time. He has also filed various paper books regarding all the relevant facts of the interest paid @ 11% to AE, corresponding varying exchange fluctuation details and payments, safe harbour rules regarding payment of interest in domestic currency as well as catena of case law that it is not "LIBOR" but domestic interest rates only which had been rightly adopted by the assessee as an interest benchmark for making payment to the overseas AE. 4. The Revenue has placed strong reliance on the TPO's respective orders. 5. We find no merit in assessee's stand. We make it cle....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... company borrowed from its AE a rupee loan and not a foreign currency loan and thereby LIBOR rate is inappropriate. 4. The Ld. Assessing Officer/TPO ought to have appreciated the fact that the interest paid on Compulsory Convertible Debentures (CCOs) by the Assessee @11% is lower than the normal rate of interest which the appellant company is paying on the other loans borrowed, in Indian rupees and thereby complying with arm's length principle. 5. Any other ground that may be urged at the time of hearing with the previous approval of the Hon'ble Members of the Dispute Resolution Panel. Out of the above grounds, grounds 1 & 5 are general and require no specific directions. Grounds 2, 3 & 4 are 011 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....amounted to Rs. 15:34,84,244/, (Emphasis supplied). It used Comparable Uncontrolled Price method (CUP) to determine the arm's length price for the interest, Considering the above interest rates of various banks. 11 % of interest incurred by the assessee company on CCO of Okio credit is considered at ALP under CUP, This was not accepted by the TPO who relying on the following decisions of the Hon'ble ITAT in the cases of Foursoft Ltd, Market Tools, Or Reddy laboratories held that UBOR is appropriate for benchmarking of ALP. The assessee submitted the case laws cited by the TPQ, in these cases the issues was that the Associated Enterprises have availed loans from the Indian company and in our case it is the reverse i.e. the c....
X X X X Extracts X X X X
X X X X Extracts X X X X
....idered. * In the case of Indian Debt Management, the Hon'ble ITAT held that Indian rates to be applied based on the facts of that case, as the Hon'ble IT AT came to that conclusion based on the fact that the CCDs have been issued in INR denominated debt and the interest paid or payable also was in INR. * In the case of Cotton Naturals, the issue therein was arms and interest rates for loan advanced to foreign subsidiary by Indian company. The assessee itself had submitted that its case is of receipt of loan from its holding company. Hence, the facts cited in the present case referred to above is not applicable to the facts of assessee's case by its own admission. * The decision of the Hon'ble High ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iness. Below that on the same page at Annexure 'B' gives the details of investments made by the AE. At (c) of the said details, it clearly mentions that the FDI has been received by the assessee from its AE in Euros, and the Indian Rupees value IS recorded in the Books of Accounts. Further, with regard to interest rate and payment at (d), it is stated that the assessee is agreed to pay at an interest of 11 %. The basis for the same is not furnished nor substantiated, The relevant page as discussed above is enclosed as Annexure A to this order. In view of the foregoing discussions, in view of the facts that the monies were received in Euros. tile basis for payment of interest at the rate of 11 % is not substantiated, we agree with th....