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2011 (3) TMI 830 - HC - Income TaxDeduction u/s 37 - expenditure incurred on account of subsidy given to MAL - payment to sister concern - held that:- The nomenclature under which part of profit is sought to be given to a sister concern is nothing else but evasion of tax. The assessee holds merely 29.16% shares in M/s Majestic Auto Ltd. Even if it had stood guarantor or had furnished certain undertaking or assurance to the financial institutions for securing the loans raised by M/s Majestic Auto Ltd., a sister concern, there is no sanctity available in law to give money as a subsidy and claiming the same to be an expense in a profit making company. If the promoters are so concerned about the financial health of the group company and also the brand name, the money can very well be invested by the promoters out of their own resources. - Deduction not allowed - decided against the assessee.
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