Hello,
My Company has received a notice from IT department towards concealment of Income by Parent Company towards Interest free loan given to its fully owned Subsidiary based in India.
Parent Company has taken a Term loan from Bank a certain% Interest for expansion of its Business. In turn for expansion of its subsidiary , Parent Company has given Interest free loan to Subsidiary.
My query is is it justified to issue Notice by IT dept to parent Company stating concealment of Income (as loan is interest free to Subsidiary).
Can you please help me with this query and provide any case law to support the same.
Regards
Kaushal
CAclubindia
