Additional criteria that the resulting company needs to meet in a demerger for the purpose of set-off and carry forward of losses and depreciation allowances - (New) Section 116(6) & (7) / (Old) Section 72A(4)&(5)

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.... for depreciation Under Section 116(6) & (7) of the Income Tax Act, 2025 [ From 01.04.2026 ] Irrespective of anything contained in any other provisions of this Act, in the case of a demerger, the accumulated loss and the allowance for unabsorbed depreciation of the demerged company shall,- • (a) if directly relatable to the undertakings transferred to the resulting company, b....

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....r the head "Profits and gains of business or profession" Excluding loss in a speculation business of the • predecessor firm or • the proprietary concern or • the private company or unlisted public company before conversion into • limited liability partnership or • the amalgamating company or • the demerged company, ....

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....sorbed depreciation is not directly relatable to the undertakings transferred to the resulting company, • be apportioned between the demerged company and the resulting company • in the same proportion in which the assets of the undertakings have been retained by the demerged company and transferred to the resulting company, and • be allowed to be carried forw....