Dismissing the appeal the Tribunal held that the whole interest amount of Rs. 75.46 lakhs was deemed to be received by the assessee upon conversion of debentures into equity shares in this year. If the amount of Rs. 61.97 lakhs was not brought to tax, it would never have been brought to tax. The taxability of interest component of debentures that had accrued to the assessee up to the date of conversion. Therefore, the action of the Assessing Officer in accepting the return of income is not in accordance with law. The order had errors which was prejudicial to the interests of the Revenue. The revision of the order is justified.(AY.2013-14)
Sanjjay Saumyha (Mrs.) v. PCIT (2024)116 ITR 17 (SN)/ [2025] 210 ITD 33 7 (Chennai)(Trib)
S. 263 : Commissioner-Revision of orders prejudicial to revenue-Income from other sources-Interest-Debentures redeemed after nine years-Conversion of debentures into equity shares-Entire interest deemed to be received by debenture holder upon conversion of debentures into equity shares in year of conversion–Assessing Officer accepted the return-Revision is justified.[S. 2(24)(iv),47(x),49(2A),56,143(1)]