https://www.taxtmi.com/caselaws?id=31347 Interest paid on fully convertible bonds until conversion was treated as interest on money borrowed or debt incurred, because conversion into equity did not change the underlying debt character; the payment was therefore taxable income in the hands of the non-resident recipient. The same payment was not dividend, since the bondholder remained a creditor rather than a shareholder, and the amount was payable irrespective of profits. Because the interest was chargeable to tax in India, the applicant was required to deduct tax at source, although the applicable rate was left for determination in separate proceedings. en-us Fri, 10 Oct 2008 00:00:00 +0530 Sat, 20 Jun 2020 15:48:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=31347 Interest paid on fully convertible bonds until conversion was treated as interest on money borrowed or debt incurred, because conversion into equity did not change the underlying debt character; the payment was therefore taxable income in the hands of the non-resident recipient. The same payment was not dividend, since the bondholder remained a creditor rather than a shareholder, and the amount was payable irrespective of profits. Because the interest was chargeable to tax in India, the applicant was required to deduct tax at source, although the applicable rate was left for determination in separate proceedings. Case-Laws Income Tax Fri, 10 Oct 2008 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=31347