Part DCA - Safe Harbour Rules for income referred to in clause (i) of sub-section (1) of section 9 chargeable to tax under the head (From Rule 10TI to Rule 10TIC)
Zero coupon bond discount computation follows a monthly apportionment method based on bond life and previous-year inclusion. Pro rata discount on a zero coupon bond is computed by converting the bond's life into calendar months, counting a partial month of fifteen days or more as a full month, and ignoring a shorter part. The total discount is divided by the resulting number of months. Where months fall within a previous year, the monthly amount is multiplied by the number of those months to determine the pro rata amount of discount for that year.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Zero coupon bond discount computation follows a monthly apportionment method based on bond life and previous-year inclusion.
Pro rata discount on a zero coupon bond is computed by converting the bond's life into calendar months, counting a partial month of fifteen days or more as a full month, and ignoring a shorter part. The total discount is divided by the resulting number of months. Where months fall within a previous year, the monthly amount is multiplied by the number of those months to determine the pro rata amount of discount for that year.
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