Discounting charges not interest for TDS & cannot be disallowed under Section 40(a)(i)

CIT Vs  Cargill Global Trading Pvt. Ltd. (Delhi High Court) Delhi High Court addressed two appeals filed by the Income Tax Department against Cargill Global Trading Pvt. Ltd. concerning assessment years 2004-05 and 2005-06. The dispute centered around a ₹97 crore payment made by the company to its Singapore-based associate, Cargill Financial Services Asia Pvt. Ltd. (CFSA), as discount charges for bill discounting. The Assessing Officer (AO) classified these charges as “interest” under Section 2(28A) of the Income Tax Act and disallowed them under Section 40(a)(i) due to non-dedu...