Expenses of related companies incurred by another company

Pvt ltd 423 views 1 replies

sir

one closely held PVT LTD Company incurs various expenses and debits part of them to another closely held pvt ltd company in which the directors are interested.

1.what is the allowability of these expenditures under the income tax laws and

2 if there is any infringment of company law as amended by the 2013 act.

 

Replies (1)

Sir,

Prima Facie this seems wrong.

The expenses bills must be in the name of first company and under no circumstances first company can allocate them to second Company.


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