Quiz for the week (15 Dec 2025) :
Rose (P) Ltd had borrowed Rs.500 lakhs from an NBFC during the FY 2021-22. The loan was
meant for business expansion. It could not repay the loan due to lull in business and cost
over run in the expansion activity. There is an arrear interest of Rs110 lakhs as on 30 th
June,2025. The directors of the company negotiated with the NBFC and it was decided that
60 % of arrear interest would be converted in to equity shares and 40% would be met by
issuing 9% debentures. The instalment due from July, 2025 would be paid regularly by the
assessee. Is the issue of equity shares and debentures, entitle the assessee to claim
deduction of arrear interest?
Share your thoughts on the above on or before 22 nd December, 2025.