Skip to content

CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Supply under GST

Which of the following persons is NOT deemed to be 'related persons' merely by the stated fact, as per the Explanation to Section 15?

Two companies in which an unconnected investor holds only 10% voting shares each are not deemed related. The Explanation requires holding of twenty-five per cent or more of voting stock in both. Legal partners, employer and employee, and family members are expressly deemed related persons.

  1. ATwo persons who are legally recognised partners in business
  2. BAn employer and its employee
  3. CTwo persons who are members of the same family
  4. DTwo companies, where an unconnected investor holds 10% voting shares in each and no other link existsCorrect

Explanation

The deeming rule for shareholding applies where a person owns, controls or holds twenty-five per cent or more of the voting stock or shares of both. A 10% holding is below the threshold. Partners, employer-employee and family members are expressly listed as related.

Did you get it right without looking?

One question tells you little. A timed set on Supply under GST shows your real accuracy, how long you take and where you lose marks.

Practise Supply under GSTFree diagnostic mock

More Supply under GST questions