7/21/2019 Amalgamation

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7/21/2019 Amalgamation

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In the following cases the deductions are allowed if by a scheme of amalgamation or demerger it is

provided, that the amalgamated company/resulting company would be entitled to get the same

deduction as that could have been availed by the amalgamating company/demerged company had it

continued to exist.

The DEDUCTIONS include,

1) Weighted deduction of 100/125/150% in respect of scientific RESEARCH expenditure u/s.35 can

be claimed by the amalgamated company (if it is an Indian company).

2) Expenditure for obtaining license to operate TELECOMMUNICATION u/s. 35ABB shall be allowed

in equal instalments during the years of license postamalgamation or demerger.

3) Amortization of preliminary expenditure u/s. 35D over a period of 5 years, (the unexpired period)

can be availed post amalgamation or demerger.

4) Amortization of expenditure in case of amalgamation or demerger u/s. 35DD, where an Indian

company incurs any expenditure wholly & exclusively for the purposes of amalgamation or

demerger, the expenditure shall be allowed as a deduction over a period of 5 years in equal

installments from the previous from the previous year of amalgamation or demerger.