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4.3.2 In this regard, it is pointed out that the loan was made in foreign currency and hence domestic Lending rates cannot be used as a base for calculating ALP (as done by the AO). The said view finds strength from the following judgments, wherein it has been held that if the loan is made in foreign currency then LIBOR (not domestic lending rates) should be used as a benchmark:
 Delhi High Court in case of CIT Vs. Cotton Naturals (I) Pvt. Ltd. [276 CTR 475]  The Chennai Bench of Tribunal in case of Siva Industries & Holdings Ltd. Vs. ACIT [145 TTJ(Chennai) 497]  Mumbai Tribunal in case of Tata Autocomp System Vs. ACIT [149 TTJ 233] [Affirmed by the Hon'ble Bombay High Court] In light of the above, the Ld. AO was clearly not justified in arriving at arm's Length interest rate by taking the cost of funds to the assessee, which is a domestic rate, as a base rate.

3. In the appellate proceedings, the Ld. AR.s of the appellant reiterated the submissions which were made before the Ld. TPO and contended that the advances given to AE was in the nature of shareholder activity and therefore it could not be equated with a 'loan' or a financing arrangement. Alternatively the ld. AR contended that the TPO erred in determining the ALP interest rate on such advance at 14.41%. The Ld. ARs of the appellant submitted that the loans given to AE should be benchmarked at then relevant currency denominated LIBOR rate, for which it placed reliance on several judgments including the jurisdictional ITAT, Kolkata in its own case for AYs 2003-04 to 2011-12.

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76. In view of the aforesaid decisions, we are of the view that instead of the base rate of 8 per cent, (based on lending rates of banks in India, for commercial borrowing), it would be appropriate to apply LIBOR rate (and not domestic lending rate). We direct accordingly.

77. The next aspect to be considered is as to whether any percentage has to be added over and above the LIBOR rate on account of credit rating of the associated enterprise. The Assessing Officer added LIBOR + 7 per cent. The basis for such addition is that any Page | 18 I.T.A Nos.191 & 192/Kol/2018 & I.T.A Nos.138 & 139/Kol/2018 M/s. Electrosteel Castings Ltd.

12. We notice herein as well that the CIT(A) has precisely followed the tribunal's earlier years' order in the assessee's cases itself directing the authorities to benchmark assessee's international transactions in the nature of loans given to its overseas Associate Enterprises (AEs) at the relevancy currency benchmark LIBOR rate prevailing in the relevant previous year(s). Learned coordinate bench's detailed discussion held that the impugned international transactions of loans in the case of AEs have to be benchmarked in the respective foreign currency LIBOR rates than the domestic market credit ratings. We make it clear that the Revenue's pleadings before us in its corresponding grounds nos.6 to 9 have nowhere drawn any distinction on facts in all the assessment years. We accordingly adopt judicial consistency mutatis mutandis in the impugned assessment years to decline instant substantive grounds.