Income Tax


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.

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


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.




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