Strategic Disinvestment and Tax Benefits in Clause 117 of the Income Tax Bill, 2025 VS. Section 72AA of the Income Tax Act, 1961

Treatment of accumulated losses and unabsorbed depreciation: successor may utilise predecessor tax attributes subject to a limited carry forward period.

Clause 117 deems accumulated loss and unabsorbed depreciation of specified predecessor entities to be those of the amalgamated entity when amalgamations involve banking companies, corresponding new banks, or government companies under Central Government sanctioned schemes, including cases following strategic disinvestment; successor entities may utilize these tax attributes in the year of amalgamation but are subject to a limited carry forward period and prescribed compliance and reporting requirements.