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CA Ankita Khatri (Querist) 06 August 2015 This query is : Resolved
my question is there are 3 seperate entities i.e. entity A, B,C. Now entity A is Nokia Co.situated in gurgaon haryana it has a dealer in up which has its franchisee and opened a showroom of nokia and nokia has a policy that every showroom should have same furniture it maintain its standard and there is a fix company M/s C who solds the furniture to nokia but since the delivery is to be done directly to up (Kanpur) hence the company A nokia has asked to dealer B in kanpur to issue its form 38 to the company C dealing in furniture but the purchase is booked by company A and payment has also been made by company A only form 38 is ued by the company B. Please suggest whether it is correct or not and if any reference of caselaws and sections can given please mention to justify the same. its urgent

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sanjeev kumar goel (Expert) 08 August 2015
Dear Ankita,

Now a days it is common that most of the MNCs maintain their own standard by fixing same type of fixture and furniture in their outlets. Even the color of walls also remain same. For this the principal company appoints a permanent supplier for supply of furniture and fixture to its franchisees. In this case the main company A reimburses the expanses only and that too not in full. Part of the payment has to bear by the franchisee. So the Franchisee has to issue his own Form 38 and there is nothing wrong in this. If you need more clarifications then you may write or call me back at following:-
E-Mail:- adv.sanjeevgoel@gmail.com
M - 09899390850