TaxTMI 
TaxTMI 
Clarification on taxability of shares held in a subsidiary company by the holding company
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....12 Dated 21/07/2023. Trade Circular 16 T of 2023 To, ............................. ............................. Subject: Clarification on taxability of shares held in a subsidiary company by the holding company Ref: Circular No. 196/08/2023-GST dt 17th July, 2023 issued by the CBIC Central Board of Indirect Taxes and Customs (CBIC) has issued the above referred circular.....
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....Principal Chief Commissioners/Chief Commissioners/Principal Commissioners/Commissioners of Central Tax (All) The Principal Directors General/ Directors General (All) Madam/Sir, Subject: Clarification on taxability of shares held in a subsidiary company by the holding company. Representations have been received from the trade and field formations seeking clarification on certain i....
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.... of service or not and whether the same will attract GST or not. Securities are considered neither goods nor services in terms of definition of goods under clause (52) of section 2 of CGST Act and the definition of services under clause (102) of the said section. Further, securities include 'shares' as per definition of securities under clause (h) of section 2&nbs....
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....se of owning a controlling interest.", unless there is a supply of services by the holding company to the subsidiary company in accordance with section 7 of CGST Act. Therefore, the activity of holding of shares of subsidiary company by the holding company per se cannot be treated as a supply of services by a holding company to the said subsidiary company and cannot be....