Inter payment by a sister concerned for other group company
Abhay Kumar Sethia
(Querist) 09 June 2018
This query is : Open
Dear Sir,
I have query on inter payment by one sister concerned for other sister concerned. I mean that one company's bank accounts is used for other company's payment. Is this covered under GST as a supply of service to one sister concerned from other sister concerned.
Can it be treated as transaction in money in the GST.
or
please suggest me other ways to avoid GST.
R.Ramachandran
(Expert) 09 June 2018
Dear Mr. Abhay Kumar Sethia, quite an interesting question. Pl. give some time to me to revert.
Guest
(Expert) 09 June 2018
Depends upon how the account books of each company show the transaction, which you have not stated. Being a CA, yourself, I hope you know very well that each of the company, may that be sister concern or otherwise, are separate artificial persons as per company law. So, if transaction with the bank attracts GST, on the same analogy, the transaction between both the companies would also attract GST.
R.Ramachandran
(Expert) 10 June 2018
Dear Mr. Abhay Kumar Sethia,
The transaction mentioned by you will not get covered under GST as a supply of service at all, from any angle whatsoever.
Ms.Usha Kapoor
(Expert) 10 June 2018
I endorse the views of Mr.Ramachandran.
Abhay Kumar Sethia
(Querist) 11 June 2018
Thanks all of you for reply,
Ms Usha Kapoor and Mr Ramchandran, can you please explain that why you are of the opinion that the issue given in the questing will not attract the GST. Please give your reasoning in Details. with the fact that one sister concerned is paying the Taxes from its bank account and the second sister concerned accounts the same that the payment made by this company.
