Clarification on taxability of shares held in a subsidiary company by the holding company.

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....sidiary company by the holding company. The Circular seeks to clarify the issue relating to whether the holding of shares in a subsidiary company by the holding company will be treated as "supply of service" under GST and will be taxed accordingly or whether such transaction is not a supply. 2. In order to clarify the issue and to ensure uniformity in the implementation of the provisions of law ....

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....ties under clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956. This implies that the securities held by the holding company in the subsidiary company are neither goods nor services. Further, purchase or sale of shares or securities, in itself is neither a supply of goods nor a supply of services. For a transaction/activity to be treated as supply of services, there must be....