On 1st April 2020, A company issued 1,000, 10% Debentures of ₹500 each. Interest is payable on 30th September and 31st March. Rate of TDS is 10% . The company closes its books on 31st March every year. Calculate the amount paid to Debenture holders on 30th September 2020.

₹22,500

The correct answer is option 3- ₹22,500.

Interest on Debentures for half year = 5,00,000 x 10/100 x 6/12
                                                          = 25,000
Less : TDS 10% of 25,000 i.e 2,500

Amount paid to Debenture holders = 25,000 - 2,500
                                                       = ₹22,500