Judgment No. 23/18 Civil Appeal No. SC 145/15 One tobacco company was required to open an Evidence Account with the appellant into which account repayments would be made. Any balance in that account after the repayment of the facilities would be applied toward the reduction of “any other offshore loans made available by the Bank on the due date of such loans”. Any residual surplus balance in the Evidence Account would be paid to the borrower. Interest was to be debited to the borrower’s account at a ‘day convenient to the bank’. [14] The respondent took the view that the interest in terms of each loan agreement had been earned by the appellant and therefore became part of the appellant’s taxable income. On this basis, the respondent wrote back into the appellant’s taxable income for the three years under mention, the interest paid by the 6 onshore borrowers. The appellant’s objection to the assessments was disallowed by the respondent and its appeal to the High Court was dismissed. Submissions on appeal [15] It was contended by Mr de Bourbon, on behalf of the appellant, that interest accruing on the loans had been paid directly to the offshore lender, namely, Standard Chartered Bank PLC London. Regarding the 3 tobacco companies and the cotton company, which were in a separate category by virtue of the Exchange Control (Tobacco Finance) Order 20045 and the Exchange Control (Cotton) Order,20086 the appellant had neither received, nor accrued the right to, any interest and that the finding of the court a quo to the contrary was wrong. Regarding the loans to the conglomerate and to the cement company, these were external loans paid externally and the agreements were subject to the laws of England. The 5 6 S.I 161/2004 as amended by SI 229/2004 S.I 150/2008 7