Charges paid for bill discounting transactions does not amount to interest

Facts:- The taxpayer, an Indian company gets its sale bills discounted from its Singapore associate companies. Singapore companies charge discounting charges for undertaking these transactions. Issues before Tribunal:- Whether the discounting charges are to be disallowed under section 40(a)(ia) since they are in the nature of „interest? and tax is not withheld by the Indian taxpayer? Contentions of the revenue:- Discounting charges are covered by the definition of interest under section 2(28A) of the Income Tax Act (ITA). In absence of withholding of tax by the Indian payer, the said paym...