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Section 4(7)

04 July 2011

Hi,

To dermine status of a private limited company under Section 4(7) , should I look status of its holding comany or should i go beyond that and look for holding's holding, and then its further holding and so on till i reach to a final group holdding company.

For e.g. ABC Pvt. Ltd. is owned by AAA Singapore which is a pvt. ltd. company ....then AAA is owned by BBB Pvt. Ltd. (UK) which is again pvt. ltd...but BBB is owned by CCC Ltd which is a public limited in USA....so should i look only upto AAA or do we have to look till CCC to determine status under Section 4(7).

regards

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6 Replies

Nidhi Jain (CS ) (987 Points)
Replied 04 July 2011

TILLTo CCC

Deepak Maharishi (CS) (514 Points)
Replied 05 July 2011

Hi nidhi,

Thanks for this reply. Can you please quote relevant section explanation and where this has been prescribed.

regds

Deepak

Nidhi Jain (CS ) (987 Points)
Replied 05 July 2011

Sorry Earlier i had not studied i have told u on the basis of classes. Now i have read ramaya and in ur case u have to taken into a/c onlytill AAA

Deepak Maharishi (CS) (514 Points)
Replied 06 July 2011

Hi Nidhi,

Can you please tell me the page no / heading of Ramaiya where this is written...

regds

deepak

Nidhi Jain (CS ) (987 Points)
Replied 06 July 2011

I have read that section their explanation in full and find out herself and with discussion to our seniors that we have to see the status of 1st holding co. But if subsy has subsy and this subsy also have another subsy. than all these subsy of subsidiary shall be the subsidiary of Holding co. I think this is not required to be clear by example u get my view.

But specifically it is not mentioned anywhere

(Guest)

As far as my knowledge is concerned, You have to go till CCC, because the pattern of the Holding and subsidiary company itself is suspicious and the chain also goes into tax heaven countries. So, there are probable chances of Money Laundering.

So, For the sake of Money Laundering Act, you have to check full details till CCC.