Major GST relief for holding companies in corporate guarantees case

In a substantial relief for many of the holding companies in India, the Punjab & Haryana high court has stayed a circular that brought corporate guarantees under the ambit of GST, ToI reported on May 7. Corporate guarantees are given by holding companies in favour of their subsidiaries. Under this mechanism, a company, known as the guarantor, promises to pay for a loan if the borrower (in this…