Loan by foreign subsidary to its indian holding company

This query is : Resolved

nitin chhabra (Querist)
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18 February 2013 DEAR ALL,
CAN A FOREIGN SUBSIDIARY GIVE LOAN TO ITS INDIAN HOLDING COMPANY? PLEASE GIVE ME THE LINK FOR THE SAME.

THANKS & REGARDS
NITIN CHHABRA

Nikhil Kaushik

Nikhil Kaushik (Expert)
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18 February 2013 i am not sure if the same serves any purpose. Plus, this may trigger deemed dividend! However, you may refer to the "Farida Holdings (P.) Ltd. v Deputy Commissioner of Income-tax [2012] 21 taxmann.com 462 (Chennai – Trib.)" case to avoid deemed dividend.

As far as FEMA issues, may be some FEMA expert should comment on it.

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CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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20 February 2013 Foreign Company can give loan to Indian Company but subject to ECB guidelines provided by RBI in this behalf.

I also feel that Deemed Dividend Clause shall not come into picture.

Anuj
femaquery@gmail.com

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