Comment on the following independent situations, whether Jack Ltd. and Jill Inc. constitute associated enterprises under the provisions of Section 92A of the Income Tax Act, 1961: (v) Jack Ltd. borrowed ₹50 crores from H

As per section 92A of the Income-tax Act, 1961, two or more enterprises are deemed as associated enterprises, if at any time during the previous year, one enterprise guarantees not less than 10% of the total borrowings of the other enterprise; Since Jill Inc. guarantee for ₹50 crores out of the total borrowing of Jack Ltd. ₹800 crores, which is only 6.25% of the total borrowing. Hence, Jack Ltd. and Jill Inc. do not qualify as associated enterprises. Therefore, Jack Ltd. and Jill Inc. are not Associated Enterprises.