Unabsorbed depreciation remains allowable after reorganisation if it would have been allowable absent the amalgamation or demerger. Unabsorbed Depreciation is the portion of a taxpayer's depreciation allowance remaining unallowed at the time of a reorganisation and which would have been allowable to the transferor entity had the amalgamation or business reorganisation not occurred. Under section 72AA this applies to amalgamating banking companies, corresponding new banks and Government companies; under section 72AB(7)(b) it applies to amalgamating or demerged co operative banks.