Clause 22 - Amendment of section 72A. - Finance Bill, 2021

Amendment of section 72A. 22. In section 72A of the Income-tax Act, in sub-section (1), (i) for clause (c), the following clauses shall be substituted, namely: (c) one or more public sector company or companies with one or more public sector company or companies; or (d) an erstwhile public sector company with one or more company or companies, if the share purchase agreement entered into under strategic disinvestment restricted immediate amalgamation of the said public sector company and the amalgamation is carried out within five year from the end of the previous year in which the restriction on amalgamation in the share purchase agreement ends, ; (ii) after the long line, the following shall be inserted, namely: Provided that the accumulated loss and the unabsorbed depreciation of the amalgamating company, in case of an amalgamation referred to in clause (d), which is deemed to be the loss or, as the case may be, the allowance for unabsorbed depreciation of the amalgamated company, shall not be more than the accumulated loss and unabsorbed depreciation of the public sector company as on the date on which the public sector company ceases to be a public sector company as a result of strategic disinvestment. Explanation . For the purposes of clause (d), (i) control shall have the same meaning as assigned to in clause (27) of section 2 of the Companies Act, 2013 (18 of 2013);. (ii) erstwhile public sector company means a company which was a public sector company in earlier previous years and ceases to be a public sector company by way of strategic disinvestment by the Government; (iii) strategic disinvestment means sale of shareholding by the Central Government or any State Government in a public sector company which results in reduction of its shareholding to below fifty-one per cent. along with transfer of control to the buyer. .