Income Tax
This query is : Open
24 January 2011
There are three companies: Company A, B and C
Company A and B are sister concern (Company A is Holding Company)
Company A require to pay Company C a sum of Rs 1 lac
Company C require to pay Company B a sum of Rs 1 lac
Can Company A take the stand that there is no liability of Company A to pay to Company C since Company C is under obligation to pay the same amount to Company B, which is subsidiary of Company A.
Company A and B are sister concern (Company A is Holding Company)
Company A require to pay Company C a sum of Rs 1 lac
Company C require to pay Company B a sum of Rs 1 lac
Can Company A take the stand that there is no liability of Company A to pay to Company C since Company C is under obligation to pay the same amount to Company B, which is subsidiary of Company A.
CA Jeen paul
(Expert)
25 January 2011
for the purpose of consolidation of financial statements, the liability will be settled. in practical ,the laibily in opinion , can not be settled because all the 3 companies are seperate entity evenif they are related
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CA PARAS BAFNA
(Expert)
25 January 2011
In my view, at the consolidation stage also
C should be shown as Debtor and Creditor separately, as C is not a group company.
C should be shown as Debtor and Creditor separately, as C is not a group company.
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