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2019 (6) TMI 1691 - ITAT MUMBAITP Adjustment - interest rate chargeable on the sum advanced by the assessee to its associated enterprises abroad - Assessee submtted rate of interest charged should be LIBOR - HELD THAT:- We find that the commercial expediency aspect of granting interest-free loans is already against the assessee by a Catena of case laws in this regard. Assessee submission that, commercial rationality should be considered in distinction from commercial expediency is not at all convincing. It is evident from the submissions of the learned counsel of the assessee himself that ITAT as well as honourable jurisdictional High Court in several case laws have upheld the applicability of interest rate of LIBOR +200 bps to 300 bps. In the present case the learned CIT-A has adopted rate of interest of labour +300 bps for assessment year 2010 – 11 which the assessee accepts. In our considered opinion on the facts and circumstances of the case following the precedent’s from ITAT and honourable judicial High Court we hold that arm’s-length interest should be computed at the rate of interest of LIBOR +300 bps. That is the rate adopted by the learned CIT-A for assessment year 2010-11 is also directed to be adopted for assessment year 2009-10. Assessee’s appeal is partly allowed and revenues appeal stands dismissed.
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