Profit on sale of Compulsory Convertible Debentures taxable as interest

The AAR while treating the Indian holding and subsidiary companies as one and the same held that the income in the hands of Mauritius based company from sale of CCDs is taxable as interest income in India. Further gains from sale of equity shares are not exempt under India-Mauritius tax treaty.

the Authority for Advance Rulings (AAR) in the case of Z (A.A.R. No.1048 of 2011)   held that income

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