Section 84: Interest on debentures issued by reference to shares

84. Interest on debentures issued by reference to shares Where a company has issued debentures to its shareholders or any class of shareholders, and the amount of the debentures issued to each shareholder has been determined by reference to the number, the nominal value or the paid-up value of the shares in that company or in any other company, whether or not that other company is being or has been wound up, that were held by or on behalf of the shareholder at the time the debentures were issued or at any earlier time, the interest paid by the company on the debentures so issued shall not be an allowable deduction and shall be deemed to be a dividend received from the company by the shareholders or class of shareholders of the company.