Claiming deduction u/s 80IC

[Toshar Ahuja]

A firm availing claiming 100% deduction u/s 80IC is taken over by a Company on 1/4/2011 (fulfilling conditions of Sec 47(xiii) of Income Tax Act, 1961) on which date 5 years of 100% deduction also expire.  Will it get 25% deduction or 30% deduction for next five years? and if the assessee starts Unit II before 01/04/2012, then will it get 100% deduction for first five years and then 30% deduction for next five years?

AI Summary

Takeover Firm's Tax Deduction Eligibility Under Section 80IC: 100% Expiry, No Amalgamation/Demerger Benefits for Firms. A firm claiming a 100% deduction under section 80IC of the Income Tax Act, 1961, is taken over by a company on April 1, 2011, coinciding with the expiration of the five-year 100% deduction period. The query concerns whether the firm will receive a 25% or 30% deduction for the subsequent five years and if starting a new unit before April 1, 2012, would allow a 100% deduction for the first five years followed by 30% for the next five. The response clarifies that such deductions are applicable only in cases of amalgamation or demerger, with no similar provision for firms.