Income of subsidery company

This query is : Resolved

vishal singla (Querist)
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29 December 2015 the assessee company made major investment in equity shares in its subsidery comapany as usa.please advise us whether any disallowance can be made u/s 14A ,on accounts of investment in shares of subsidery company.

CA Chirag Haraniya

CA Chirag Haraniya (Expert)
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29 December 2015 Hi Vishal,

Disallowance u/s 14A will not be attracted in case of Investment in Foreign Subsidiary as whatever Income Company may get from it's Subsidiary as a Shareholder will not be exempt from the tax viz. Capital Gain or Dividend.

Even a Strategic Investment in Indian Subsidiary does not attracts disallowance u/s 14A, you can find many case laws in favor.

Regards,
Chirag M. Haraniya

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