Mumbai ITAT holds that financial service business of the Assessee constitutes an undertaking and transaction qualifies as demerger as per section 2(19AA) of the Income-tax Act, 1961 (‘Act’) and therefore, not liable for dividend distribution tax (‘DDT’)1
Background
• Grasim Industries Limited (‘GIL’ or ‘Assessee’) was a listed company and engaged in the business of manufacturing of viscose staple fiber, chemicals, textiles etc.
• Aditya Birla Nuvo Limited (‘ABNL’) was another company engaged in financial services business (‘FSB’) and it had earlier acquired FSB of Birla Global Finance Company Limited, a non-banking finance company (‘NBFC’) by way of amalgamation.
