https://www.taxtmi.com/caselaws?id=205013 Discounting charges reimbursed in connection with bills of exchange for supply transactions were treated as part of the purchase price, not as interest under section 2(28A) of the Income-tax Act, 1961. The distinction between interest on loans or advances and discount on bills of exchange was reinforced by the scheme of the Interest Tax Act, 1974 and the CBDT circular stating that such discounting is not technically interest and does not require tax deduction at source. On that footing, the charges were outside Chapter XVII-B and disallowance under section 40(a)(ia) was not justified, so the addition was deleted in favour of the assessee. en-us Mon, 13 Jun 2011 00:00:00 +0530 Wed, 17 Aug 2011 01:01:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=205013 Discounting charges reimbursed in connection with bills of exchange for supply transactions were treated as part of the purchase price, not as interest under section 2(28A) of the Income-tax Act, 1961. The distinction between interest on loans or advances and discount on bills of exchange was reinforced by the scheme of the Interest Tax Act, 1974 and the CBDT circular stating that such discounting is not technically interest and does not require tax deduction at source. On that footing, the charges were outside Chapter XVII-B and disallowance under section 40(a)(ia) was not justified, so the addition was deleted in favour of the assessee. Case-Laws Income Tax Mon, 13 Jun 2011 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=205013