Business in Adult Daughter's name while she is studying & working Abroad

[Neeloy Kumar Bakshi]

       Sir/Madam,

                       Please refer Issue Id-105679 dtd 15/05/13.I had received a reply from CA Gopalji Agrawal.My CA is of the opinion that this will amount to Diversion of Income by me.

Can you please clarify  my doubt so that the matter can be resolved.Thanks & Regard's

[DR.MARIAPPAN GOVINDARAJAN]

Please refer my answer in 105679.

AI Summary

Diversion of income: parental use of adult daughter's business identity abroad raises tax attribution and beneficial ownership concerns.
Possible tax attribution arises where a parent conducts business in the name of an adult daughter abroad, focusing on whether the arrangement constitutes Diversion of Income by concealing continued parental benefit or control; analysis requires examination of beneficial ownership, actual control, receipt and application of profits, and documentary evidence of independent ownership.