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ITAT: Accrued interest component on non-convertible debentures sales is taxable as interest income

The Income Tax Appellate Tribunal (ITAT) ruled that the accrued interest from non-convertible debentures (NCDs) sales should be taxed as interest income rather than capital gains. This decision is significant as it clarifies the tax treatment of NCDs, potentially leading to increased scrutiny from tax authorities and encouraging litigation regarding interest income classification. Tax experts believe this ruling will have implications for investors and financial institutions involved in NCD transactions.