This is premium content. Please become a Premium member. If you are already a member, login here to access the full content.
Discounting Charges are Not Interest – SC
Case Law Details
- Case Name
- CIT Vs Cargil Global Trading I. P. Ltd (Supreme Court of India)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Courts
- Supreme Court of India
Background and facts
The Taxpayer is in the export business. On exports made by the Taxpayer on credit terms, the Taxpayer draws Bill of Exchange (BEs) on the buyers for the sale value, with a maturity period of about six months. The Taxpayer discounts the BEs with its non-resident associate concern, a company that is a tax resident of Singapore (SingCo), on ‘without recourse’ basis. SingCo is engaged in the business of underwriting, acquiring, owning, selling etc., of securities, negotiable instruments, commercial papers etc., and has no presence in India.
On account of discounting on â€...
