Section 22 - Amendment of section 72A

Transfer of accumulated losses to successor LLP allowed on business reorganisation, subject to conditions and reversal on non compliance.

The amendment treats the accumulated loss and unabsorbed depreciation of a predecessor private or unlisted public company as the loss or allowance of the successor LLP in the year of business reorganisation, subject to the conditions in the proviso to clause (xiiib) of section 47, with set off and carry forward rules applying accordingly. Non compliance with those conditions causes amounts set off or allowed in the hands of the successor LLP to be deemed its income in the year of non compliance. Definitions of 'accumulated loss' and 'unabsorbed depreciation' are revised to reflect amounts the predecessor would have been entitled to under the Act absent the reorganisation.