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2018 (10) TMI 127 - AT - Income TaxDetermination of Arm length price in respect of interest charged on advances given to the subsidiary company M/s Jayant PTE Ltd, which is also the Associated Enterprise(AE) of the assessee company - Held that:- As decided in the assessee’s own case for the assessment year 2011-12 and 2012-13 decided the issue in favour of the assessee and held that on out bound loans, the LIBOR rate should be adopted. In the instant case, the assessee has charged the interest @ 4. 5% which is more than the LIBOR rate. Respectfully following the view taken by this Tribunal in the assessee’s own case for the assessment year 2011- 12 and 2012-13 supra, we uphold the order of the Ld. CIT(A) and dismiss the appeal of the revenue on this ground. Corporate guarantee fee - Held that:- Similar view was taken up by the Coordinate Bench of ITAT, Hyderabad in the case of Batronics India Ltd. (2017 (9) TMI 1649 - ITAT HYDERABAD). In the instant case, the facts are identical. The assessee had given corporate guarantee to its 100% subsidiary and the AE for the purpose of business. The assessee had not incurred any expenditure towards the corporate guarantee. The revenue could not bring any evidence to establish that the assessee had incurred any expenditure for extending the corporate guarantee. As stated by the Ld. AR it is the obligation on the part of the assessee to extend the support and assistance to its subsidiaries for business development. Since the facts are identical, respectfully following the view taken by coordinate benches in the case laws cited, we hold that the corporate guarantee given by the assessee on behalf of its AE would not constitute an international transaction within the meaning of 92B of the Act. Accordingly, we uphold the order of the Ld. CIT(A) and dismiss the appeal of the revenue.
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