TMI Blog2015 (2) TMI 1126X X X X Extracts X X X X X X X X Extracts X X X X ..... rest on inter-cooperate deposit - ITAT deleted the addition - Held that:- the interest rates on rupee bonds and debts, which has been extensively referred to in the order of the TPO, have no relevance at all. It is only elementary that interest is nothing but time value of money and when inflation pressure on a currency is lower as is the case with most strong currencies, the time value of money, i.e. interest, tends to be lower too. Therefore, comparing interest rate on rupee loans cannot at all be compared with interest rates on strong currencies like GBP, USD and CAD. All these erudite discussions about Indian bond market and interest rate are thus wholly irrelevant The ITAT has taken note of the fact that two specific comparables of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R. JUSTICE R.K.GAUBA For the Appellant : Mr. N.P. Sahni Sr. Standing Counsel with Mr. Nitin Gulati, Jr. Standing Counsel. For the Respondent : Mr. Ajay Vohra, Sr. Adv. with Ms. Kavita Jha and Ms. Shraddha, Advs. ORDER MR. JUSTICE S. RAVINDRA BHAT (OPEN COURT) 1. Admit. 2. Following questions of law are urged for consideration: (i) Whether the ITAT has erred in law and on facts in deleting the addition of ₹ 3,46,00,000/- pertaining to the non refundable deposits being treated as income by the AO? (ii) Whether the ITAT has erred in law and on facts in deleting the addition of ₹10,11,786/- respecting ALP adjustment on account of interest on inter-cooperate deposit? 3. The Revenue urges that the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of an issue for a subsequent year when the same fundamental aspect permeates in the different assessment years. In view of these discussions, as also bearing in mind entirety of the case, we are not inclined to approve the addition made by the Assessing Officer. We direct the AO to delete the same. The assessee gets the relief accordingly. 5. This Court also notices that the assessee s contentions with regard to spread over of such amount was accepted in all the earlier years, except the year in question i.e. Assessment Year (AY) 2007-08. Therefore, keeping in view the Supreme Court s ruling in CIT vs. Excel Industries Ltd. 2013 (358) ITR 295, it is held that the reconsideration of an issue, especially since it pertains to the metho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ower too. Therefore, comparing interest rate on rupee loans cannot at all be compared with interest rates on strong currencies like GBP, USD and CAD. All these erudite discussions about Indian bond market and interest rate are thus wholly irrelevant. As for TPO's observation to the effect that the tested party being the assessee before us, i.e. lender, the prevalent interest that could be earned by the taxpayer by advancing loan to an unrelated party in India, we can only m point out that the interest rate on foreign currency loans being qualitatively different, even if we have to see the interest that the assessee would have earned on foreign currency loans and not rupee denominated loans. 8. The ITAT has also taken note of the fac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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