Under Ind AS 109, a contractual modification of an existing financial LIABILITY is considered SUBSTANTIAL (and accounted as an extinguishment) when:

Para B3.3.6 — the "10% test" for substantial modification of a financial liability: discount cash flows under new terms at the ORIGINAL effective interest rate; if PV differs by ≥ 10% from PV of remaining cash flows of the original liability, treatment is EXTINGUISHMENT (derecognise old + recognise new at fair value; gain/loss to P&L; fees as part of that gain/loss). Non-substantial modifications: adjust amortised cost, new costs/fees added to carrying amount.