Yogita Bhatia (Company Secretary) (116 Points)
25 June 2014Q: Whether Amalgamated entity is entitled to the depreciation and other benefits available to the Amalgamating Company after Amalgamation under the provisions of the Income Tax Act, 1961. (Both companies being healthy Profit making Companies) ?
Please refer the relevant sections also.
Thanks
CA Ramsai N
(Fresher)
(594 Points)
Replied 25 June 2014
As you said both companies are healty companies., so depreciation might have been availed by amalgamating company before amalgamation and there is no possibility of unabsorbed depreciation. After amalgation, the assests of amalgamating company will be the assests of amalgamated company so amalgamated comapny could avail the depreciation under normal provision of Sec 32 of IT Act as it is the owner of assets.
But incase if there is any unabsorbed depreciaiton or Business loss to amalgamating company then amalgamated company can claim such unasorbed dep or loss as per SEC 72A of IT Act
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