Interest paid in earlier year cannot be used for ALP computation

DCIT Vs Kolte Patil Developers Ltd. (ITAT Bangalore)

The assessee issued CCDs/OCDs in 2009 at interest rate of 15%. It was for the first time that the AO for the assessment year 2011-12 treated Arm’s Length rate of interest at 8% on the basis of LIBOR plus certain basis points and made transfer pricing adjustment for the remaining interest equivalent to 7%. The ld. CIT(A), considering the interest paid by the assessee to IDBI Bank as Internal Comparable under the CUP method, determined the ALP of interest at 13.75%. Both t

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