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2011 (1) TMI 37 - AT - Income TaxAssociated enterprises (AE) - Additional income as determined by Transfer Pricing Officer ('TPO') - the matter was referred to the TPO who has determined an additional income of ₹ 56,60,486/- u/s.92C as Arms Length Price ('ALP') adjustment. As a result of the above, the loss determined in the case of the assessee company came down to ₹ 74,93,048/- Held that: - when a file is referred to TPO for the purpose of examining the matter relating to ALP, the assessing authority is referring the entire gamut of international transactions for the consideration of the TPO. The purpose of an ALP analysis itself is in the larger context of anti-evasion measures - TPO is having the jurisdiction to examine the issue of outstanding receivables and noncharging of interest thereon. Direction given by CIT - direction that a reasonable period may be provided as interest-free period and no interest be calculated for such interest-free period. Interest is to be calculated for the period overflowing the interest-free period, just and proper - A Direction which is applicable to formal loans cannot be made applicable to the present case, hence vacated - Direction to adopt LIBOR/US-FED rate for calculating the interest, TPO adopted indian rate instead of US rate - Action of TPO is justified - period chargeable to interest has to be recomputed and a reasonable deposit rate has to be applied for calculating the interest
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