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Non-repayment of loan advanced to subsidiary company is allowable business loss
Case Law Details
- Case Name
- Banpal Oilchem Pvt. Ltd. Vs ACIT (ITAT Ahmedabad)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 2011-12
- Courts
- All ITAT, ITAT Ahmedabad
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Banpal Oilchem Pvt. Ltd. Vs ACIT (ITAT Ahmedabad)
ITAT Ahmedabad held that loss on account of non-repayment of loan advanced to subsidiary company for the purpose of incorporation of business is an allowable business loss.
Facts- The assessee company is engaged in the business of non-edible castor oil. The assessee set up wholly owned subsidiary named Banpal Agro-Tech Pvt. Ltd. The assessee advanced a sum of Rs. 2,88,52,100/- to the subsidiary company incorporated for the above purpose. However, the business of the subsidiary company could not take off and it was unable to repay the aforesaid ...
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