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2022 (8) TMI 1392 - AT - Income TaxTP Adjustment - treating CCDs as equity and holding that no interest is payable on equity capital thereby computing the ALP of interest as Nil - HELD THAT:- We note that in the preceding assessment years, the issue has been considered in favour of the assessee by observing that before the date of conversion, the interest paid on convertible debentures cannot be treated as interest on equity and that such interest paid on the debentures are allowable as expenditure u/s. 36(1)(iii) of the Act. Determination of ALP of the transaction has also been remanded by the Coordinate Bench of this Tribunal in own case [2019 (8) TMI 554 - ITAT BANGALORE] as held also a claim of the assessee that ALP of interest should be decided in A. Y. 2009 - 10 only being the initial year in which CCDs were issued. There is no decision of any of the lower authorities in any year. Considering all these facts, we feel it proper to restore the ALP aspect to AO/TPO in all of these years for a decision as per law after providing adequate opportunity of being heard to the assessee Respectfully following the same, we also direct the Ld.AO/TPO to compute the ALP of the interest for the year under consideration in accordance with the transfer pricing provisions. Accordingly, Ground raised by assessee stands allowed for statistical purposes.
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