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 guarantee on behalf of the associated enterprise. The above rate taken was rejected by ITAT &...