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13 April 2009 When a 'X'company is under loss/bankruptcy Why a 'Y' company which is doing well will acquire 'X'. What are the benefits for 'Y'. What is 'X''s position in the company.
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CS Vivek Hegde

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CS Vivek Hegde (Expert)
15 April 2009 Subhashri

The main benefits to "Y" are:

1. Benefit of carry forward of losses under sec 72 of income tax Act 1961.

2. Utilisation of unused capacities

3. Economies of scale

At the same time "x" can take the shelter of "Y" to revive if it continues to exist.

Vivek

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