Treatment of discount on redemption of debenture

Dear Collegues

A Ltd - has issued Debentures aggregating Rs 5.00 crs (500 denentures at a face value of Rs 1 lac each). During the current financial year, the company wants to redeem the aforesaid debenure at discount, ie., (500 debenture will be redeemed at Rs 80,000 each).

Kindly clarify in Tally - under what head - Discount on redemption of debentures need to be classified. Will it attract tax

 

Thanks

Replies (2)

you should first confirm wheather its possible to redeem debentures on discount. I doubt if a company can redeem debentures on discount

I think, it would be credited to P&L Account and accordingly it will be chargeable to tax.

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