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CS Executive · Setting Up of Business, Industrial and Labour Laws · Setting up of Branch Office, Liaison Office and Wholly Owned Subsidiary by Foreign Company

Zephyr Robotics GmbH, a German company, has set up a branch office in Pune and has a principal place of business in India. Under the Companies Act, 2013, section 128 applies to such a foreign company to the extent of requiring it to keep at its principal place of business in India books of account relating to which of the following?

A foreign company must keep at its principal place of business in India books covering monies received and spent, sales and purchases, and assets and liabilities relating to its Indian business. The requirement is limited to Indian operations, not the parent's worldwide records.

  1. AOnly the monies received and spent by its parent in Germany
  2. BMonies received and spent, sales and purchases made, and assets and liabilities, in relation to its business in IndiaCorrect
  3. COnly the sales and purchases of its group companies worldwide
  4. DOnly the shareholding pattern of the German parent

Explanation

Section 384(3) applies section 128 to a foreign company to the extent of requiring it to keep at its principal place of business in India books with respect to monies received and spent, sales and purchases made, and assets and liabilities in the course of or in relation to its business in India. The other options relate to global or parent-level records, which are not required.

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