Case Law Details
Issue is:- “Whether the funding of the interest amount by way of a term loan amounts to actual payment as contemplated by Section 43B of the Income-tax Act, 1961?”
Fact of the case:-
1. Assessee was heavily indebted to its institutional creditors and ICICI was the lead manager of those creditors.
2. The accumulated interest on the overdue principal had mounted to Rs. 3,00,14,900 and The assessee was unable to discharge this interest liability due to its financial hardship.
3. the ICICI, by a letter waived a part of the compound interest together with the commitment charges and agreed to accept 3,00,149 convertible debentures of Rs 100 each, amounting to Rs. 3,00,14,900 in lieu of the outstanding interest.
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