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Sec 372 A of Co's Act, 1956

CA Sahil Singla.. (Service Tax ) (3746 Points)

04 June 2011

Sir

It is mentioned in ICAI Module that Sec 372A is not applicable in case of gurantee given by A ltd. in respect of loan made by any person to A's wholly own subsidiary.

So does it mean that Sec 372A is applicable to A Ltd in case of guarentee given by it to it's wholly own subsidiary that is B Ltd for loan granted by B Ltd. to any person ?

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2 Replies

Rajnikant Vadigoppula (CA, CS And CMA Final) (919 Points)
Replied 05 June 2011

yes, u r correct. Wholly owned subsidiaries are exempt u/s 372A

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CA Sahil Singla.. (Service Tax ) (3746 Points)
Replied 05 June 2011

sir

U have not understood my question .

My question is whehter exemption u/s 372A(8) still there in case of guarantee given by a Co. to it's wholly own subsidiary for a laon given by a subsidiary to any person. ?

bcoz there is no mention of the ICAI module & Munish bhandari sir's buk....both says that exemption is there in case of guarntee given by a Co. to a person for loan given to Co's wholly own subsidiary .....but they didn't mention about recerse case ?

plz try to understand my question