TaxTMI 
TaxTMI 
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?
Claiming deduction u/s 80IC
31 Dec 2010 
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Tax deduction continuity after a firm takeover is unavailable; entitlement exists only for amalgamation or demerger with sunset provision.
Continuation of preferential start up deductions after a firm is taken over by a company is permitted only in the circumstances of an amalgamation or demerger; a plain firm takeover does not invoke those provisions. Where amalgamation or demerger relief applies, availability of the deduction is subject to a statutory sunset that limits transitional entitlement. (AI Summary)
Continuation of preferential start up deductions after a firm is taken over by a company is permitted only in the circumstances of an amalgamation or demerger; a plain firm takeover does not invoke those provisions. Where amalgamation or demerger relief applies, availability of the deduction is subject to a statutory sunset that limits transitional entitlement. (AI Summary)