Treatment of Bonds and Debentures

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Daya

Daya (Querist)
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12 February 2022 what is difference between Bonds and Debentures,
and what is its Tax treatment.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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12 February 2022 Bonds are essentially loans that are secured by a physical asset. ... Generally, the lender also receives a fixed rate of interest during the duration of the bond's term. Debentures, on the other hand, are unsecured debt instruments that are not backed by any collateral.
Tax treatment will be the same.