Commercial Guarantee by Co. to its subsidiary can’t be considered same as that of provided by Bank for ALP

Brief:

Assessee had provided a corporate guarantee on behalf of its associated enterprise M/s. Thomas Cook Mauritius Operations Co. Ltd. for banking facilities availed by it from HSBC bank to the extent of Rs.6,01,80,000/-. Transfer Pricing Officer was of the view  that in the absence of any guarantee fee commission earned by the assessee from such transaction& thus for ALP the rate of 3% was taken to determine the arm’s length rate of the international transaction of provision of corporate guarante

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