https://www.taxtmi.com/caselaws?id=206212 Discounting of bills of exchange or promissory notes on a without recourse basis was treated as a purchase of the instrument, not a loan or debt-claim arrangement, so the discount margin was not interest under domestic law or the treaty definition. The income was characterised as business income; on the assumed facts, it was not taxable in India under the DTAA because no permanent establishment in India was assumed and no profits were attributed to one. As a result, withholding tax under section 195 was not attracted and transfer pricing compliance was not insisted upon for the transaction, but a return of income remained required because the income was chargeable under the Act, though protected by the treaty. en-us Tue, 03 May 2011 00:00:00 +0530 Tue, 18 Oct 2011 08:20:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=206212 Discounting of bills of exchange or promissory notes on a without recourse basis was treated as a purchase of the instrument, not a loan or debt-claim arrangement, so the discount margin was not interest under domestic law or the treaty definition. The income was characterised as business income; on the assumed facts, it was not taxable in India under the DTAA because no permanent establishment in India was assumed and no profits were attributed to one. As a result, withholding tax under section 195 was not attracted and transfer pricing compliance was not insisted upon for the transaction, but a return of income remained required because the income was chargeable under the Act, though protected by the treaty. Case-Laws Income Tax Tue, 03 May 2011 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=206212