Compulsory convertible debentures not equity – Interest allowable

CAE Flight Training (India) Pvt. Ltd. Vs DCIT (ITAT Bangalore) Outcome: Partly in favor of assessee Facts of the Case: The assessee is a JV by Emirates & Flight Training Devices (Mauritius) Ltd. The company is engaged in providing training services in the field of aircraft simulation for pilots and providing simulators on rental basis. The assessee had issued compulsory convertible debentures (CCDs) to its Associated Enterprises (AEs) and paid interest of Rs. 7,41,69,020 at the rate of 15%. The assessee has benchmarked the interest rate using LPC Loan Connector Blumberg Bond and Bombay St...