TMI Blog2015 (11) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... - ITAT DELHI] was not considered by the Tribunal in any of these eight cases. Now, as rightly contended on behalf of the assessee, the judicial hierarchy is to be respected and an order passed by a higher court/authority cannot be disregarded/distinguished for any reason, including for non-consideration of some case laws, as has been done by the ld. DRP in the present case. There is no gainsaying that the orders of the Tribunal are binding on the lower authorities, including the DRP. “Agarwal Warehousing & Leasing Co. Ltd.”, (2002 (7) TMI 86 - MADHYA PRADESH High Court), as pointed out, is the authority on the point. Therein, the decision of the Hon’ble Supreme Court in the case of “Kamlakshi Finance Corporation Ltd.”,[1991 (9) TMI 72 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of interest at 12.7% in respect of the foreign currency loan given to Associate Enterprise. The appellant prays that the Learned Dispute Resolution Panel has erred in taking the applicable interest rate at 12.7%. 4. On the facts and circumstances of the case the appellant prays that, s the foreign currency loan was given in US dollars, the External Commercial Borrowing rates as applicable in the international market should be applied in respect of foreign currency loan given to the Associate Enterprise instead of the rate of interest at 12.7% as determined by the Learned Transfer Pricing Officer and confirmed by the Dispute Resolution Panel. 2. Ground No. 1 is general in nature. 3. At the time of hearing, the ld. Counsel for the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Systems Ltd. vs. ACIT (Mumbai Tribunal) ITA No. 7354/Mum/2011. 2. Tech Mahindra Limited vs. DCIT (Mumbai Tribunal( ITA No. 1176/Mum/2010. 3. M/s Logix Micro Systems Ltd. vs. ACIT (Bangalore) ITA No. 423/Ban/2009. 4. Ajhent Technologies Pvt. Ltd. vs. ITO (Delhi Tribunal) ITA No. 3647/Del/2007. 5. M/s Siva Industries Holdings Ltd. vs. ACIT (Chennai Tribunal) ITA No. 2148/Mds/2010. 6. Aurionpro Solutions Ltd. vs. Addl. CIT (Mumbai Tribunal) ITA No. 7872/Mum/2011. 7. Cotton Naturals (I) P. Ltd. vs. DCIT (Delhi Tribunal) ITA No. 5855/Del/2012. 8. Hinduja Global Solutions Ltd. vs. Addl. CIT (Mumbai Tribunal) ITA No. 254/Mum/2013. 7. It has been contended that, before the DRP, the assessee had filed copies of the above ei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransaction as if the said transaction is between two independent parties. When the assessee is granting loans to its AE from its own funds, the same has to be bench marked as if the assessee was granting loan to a third party abroad. No taxpayer will give away its own funds to a third party without an appropriate price (in terms of appropriate interest) charged for the same. The assessee has given loans to its AE without any security and therefore it has undertaken various risks like entity risk, currency risk and country risk etc. Hence, in a third-party situation, the transaction under consideration has to be benchmarked at the interest rate, which should be the cost of borrowing of the assessee. Further, since any businessman would like ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, therefore, uphold the proposed arm s-length price of interest at 12.7%. The objection of the assesee is rejected. 11. It is seen that in the eight case laws cited by the assessee, it has been held that it is the LIBOR, which has to be applied in the case of foreign currency loan given to AE. All these case laws were cited by the assessee before the ld. DRP. However, the ld. DRP has not followed these case laws, contending that the decision in Perot Systems TSI (I) Ltd. rendered vide order dated 13-10-2009, in ITA Nos. 2320, 2321 and 2322/Del/2008, was not considered by the Tribunal in any of these eight cases. Now, as rightly contended on behalf of the assessee, the judicial hierarchy is to be respected and an order passed by a hig ..... X X X X Extracts X X X X X X X X Extracts X X X X
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