Legal Frameworks for losses and unabsorbed depreciation Carry Forward in Co-operative Bank Mergers and Demergers in Clause 118 of the Income Tax Bill, 2025 Vs. Section 72AB of the Income Tax Act, 1961
10 April, 2025
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Carry forward and set off of losses preserved for successor co operative banks, subject to specified conditions and penalties. Successor co operative banks may set off predecessor accumulated business losses and unabsorbed depreciation in amalgamations as if the amalgamation had ... Summary
Carry forward and set off of losses preserved for successor co operative banks, subject to specified conditions and penalties.
Successor co operative banks may set off predecessor accumulated business losses and unabsorbed depreciation in amalgamations as if the amalgamation had not occurred; in demergers directly related tax attributes transfer wholly to the resulting bank while non relatable attributes are apportioned by asset distribution. Application requires continuity of banking business, retention and use of fixed assets, and genuine continuation of operations; failure to meet conditions renders previously allowed set offs taxable in the year of non compliance. Clause 118 adds a Central Government power to prescribe further conditions to ensure genuine business purposes.
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