Where one enterprise is controlled by an individual,
the other enterprise is also controlled by
- such individual, or
- his relative, or
- jointly by such individual and relative of such individual.
Facts:
- Mr. A controls Indian company (ICO), and
- Foreign Company (FCO) is controlled by
- A
- Relative of Mr. A
- Jointly by Mr. A and relative of Mr. A.
Issue:
- Whether FCO & ICO will be deemed to be Associated enterprise ?
Solution:
- Since, FCO is controlled by Mr. A/ Relative of Mr. A/ Jointly by Mr. A and his relative who has 100% voting rights in ICO, hence, both FCO and ICO will be deemed to be the Associated enterprise.