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15. The Ld A.R, in the alternative, submitted that the co-ordinate bench of Tribunal has sustained the addition to the extent of Libor rate plus 150 bps on an identical issue in the earlier years.

16. We heard Ld D.R on this issue and perused the record. We notice that the co-ordinate bench in the earlier years have taken a consistent view and sustained addition to the extent of LIBOR rate plus 150 bps. Hence we modify the order passed by Ld CIT(A) on this issue and direct the AO/TPO to compute interest by applying rate of LIBOR rate plus 150 bps for the outstanding period of loan.

            Sr   Name of the AE                       Amount in Amount in `
                                                      USD
            1    M/s. Gapco Kenya                         67,088 29,44,064
            2    M/s. R1L USA Inc                         484,833 225,02,627
            3    M/s. International Oil Trading Ltd       145,377            68,92,322
                 Total                                    697,298 3,23,39,013

13.10. The said interest has been charged at the prevailing short term interest rates, which were in the range of 1 month Libor plus spread of 125 basis points. Depending upon the Libor rates prevailing during FY 2009-10, the effective interest rate worked out in the range of @ 1.45% to 1.75% p.a. 13.11. The AO/TPO treated the delayed payments with respect to the sale proceeds of petroleum products, as loan to AE's, and determined the ALP of interest (received) on delayed payments, at Rs. 14,02,70,469 by considering the ALP rate of interest at 6.94% p.a., by adopting the assessee long term cost of borrowing @ 3.94% p.a. plus suitable mark-up of 3% p.a. for various factors such as currency risk, entity risk and country specific risk. Thus the AO made an adjustment of Rs. 10,79,31,456 i.e. M /s . R e l i a n c e In d us tr i e s l i m i te d (ALP interest chargeable of Rs. 14,02,70,469 - value of international transaction of Rs. 3,23,39,013).

(iv) The Appellant has itself benchmarked this international transaction of receivables by applying the rate of LIBOR+125 basis points. In order to benchmark this transaction, it has furnished the copy of letters issued by BNP Paribas Dated 17.12.2009 and M/s Intesa Sanpaola dated 16.12.2009 wherein, these two independent parties have agreed to provide short term loan to the Appellant to M /s . R e l i a n c e In d us tr i e s l i m i te d finance the imports of crude and/or petroleum products and the general working capital requirements at the rate of LIBOR+45 basis points. In rejecting this benchmarking done by the assessee, the TPO/AO has not given any reasoning. In view of the above, the rate of interest charged to AE's for delayed payment by applying an arm's length interest rate of LIBOR+ 125 basis points, after considering the benchmarking done by the assessee, is held to be at arm's length- Hence, the adjustment of Rs 10,79,31,456/- (14,02,70,469 - 3,23,39,013) made by the TPO/AO by applying the arms length rate of 6.94% based upon the weighted average cost of domestic as well as foreign borrowing of the assessee and adding 3% to cover the risks involved, stands deleted. The appeal of the assessee on this point is, therefore, allowed.

114. The next ground urged by the assessee in Ground no.7 relates to the TP adjustment made on the interest chargeable in respect of loan advanced to REP DMCC at Libor plus 325 basis points. Identical adjustments were made in AY 2010-11 also. We noticed that the co-ordinate benches in the earlier years have taken a consistent view and sustained addition to the extent of LIBOR rate plus 150 bps. Accordingly we modified the order passed by Ld CIT(A) on this issue in AY 2010-11 and directed the AO/TPO to compute interest by applying rate of LIBOR rate plus 150 bps for the outstanding period of loan. Accordingly, following the said order, we modify the order passed by Ld CIT(A) on this issue and direct the AO/TPO to compute interest by applying rate of LIBOR rate plus 150 bps for outstanding period of loan.