Amalgamation of company

Profits will be taxable in the hands of succesor company i.e the amalgamated Co.

all the statuory requirements are to be done by the succesor company.

Dear Chintan,

With due respect I would like to quote

Sec 170

Where a person carrying on any business or profession (such person hereinafter in this section being referred to as the predecessor) has been succeeded therein by any other person (hereinafter in this section referred to as the successor) who continues to carry on that business or profession,—

             (a)   the predecessor shall be assessed in respect of the income of the previous year in which the succession took place up to the date of succession;

             (b)   the successor shall be assessed in respect of the income of the previous year after the date of succession

 

 

Further, Tax Audit will not be required if turnover has not exceeded the limit.

 

Yes return will be filed by both the companies - For details refer Self explanatory Sec 178 reads as under

178.    (1) Every person—

                      (a)     who is the liquidator of any company which is being wound up, whether under the orders of a court or otherwise ; or

                      (b)     who has been appointed the receiver of any assets of a company,

(hereinafter referred to as the liquidator) shall, within thirty days after he has become such liquidator, give notice of his appointment as such to the ¹⁴[Assessing] Officer who is entitled to assess the income of the company.

(2) The ¹⁴[Assessing] Officer shall, after making such inquiries or calling for such information as he may deem fit, notify to the liquidator within three months from the date on which he receives notice of the appointment of the liquidator the amount which, in the opinion of the ¹⁵[Assessing] Officer, would be sufficient to provide for any tax which is then, or is likely thereafter to become, payable by the company.

¹⁶[(3) The liquidator—

             (a)   shall not, without the leave of the ¹⁷[Chief Commissioner or Commissioner], part with any of the assets of the company or the properties in his hands until he has been notified by the ¹⁸[Assessing] Officer under sub-section (2) ; and

             (b)   on being so notified, shall set aside an amount, equal to the amount notified and, until he so sets aside such amount, shall not part with any of the assets of the company or the properties in his hands :

Provided that nothing contained in this sub-section shall debar the liquidator from parting with such assets or properties for the purpose of the payment of the tax payable by the company or for making any payment to secured creditors whose debts are entitled under law to priority of payment over debts due to Government on the date of liquidation or for meeting such costs and expenses of the winding up of the company as are in the opinion of the ¹⁹[Chief Commissioner or Commissioner] reasonable.

(4) If the liquidator fails to give the notice in accordance with sub-section (1) or fails to set aside the amount as required by sub-section (3) or parts with any of the assets of the company or the properties in his hands in contravention of the provisions of that sub-section, he shall be personally liable for the payment of the tax which the company would be liable to pay :

Provided that if the amount of any tax payable by the company is notified under sub-section (2), the personal liability of the liquidator under this sub-section shall be to the extent of such amount.]

(5) Where there are more liquidators than one, the obligations and liabilities attached to the liquidator under this section shall attach to all the liquidators jointly and severally.

(6) The provisions of this section shall have effect notwithstanding anything to the contrary contained in any other law for the time being in force.

 

Good Details by amir

Thank you amir bhai.....

Thank u members...................

For both the amalgamating company it is required to keep books of accounts, and get it audited and also required to file a return for the part of the year. As per the company law, it is compulsory to get account audited. And as per sec. 44AB read with sec. 139 of I.T. Act if audit of accounts are mandatory in any law then tax return along with Tax Audit report (in 3CA/3CB and 3CD) should be filed on or before Sept.30. although turnover does not exceed the limit defined in Sec. 44AB. The limit of 60 lac is applicable for A.Y. 2011-12 corresponding Financial year 2010-11.

Till date of amalgamation the accounts has to get audited if they exceed 40lacs .is this right my friends

Say an application for amalagamation in the Court has been filed by the company and effective date is 01/04/2011. The Court, till date, has not sanctioned the scheme of amalgamation. Meanwhile, the transferor company has completed a Previous Year and thereby, filed the income tax return. Now, whenever the scheme will get sanctioned, the effective date will be 01/04/2011 i.e. transferee company will cease to exist therefrom as it will get dissolved. However, the same has filed ITR for the PY 2011-12. Questions:-

How shall this conflict between Income Tax Act and Companies Act shall be dealt with?
If the transferor company is erroneous in fiing the ITR then what's the remedy?

Dear Members,

If someone may please respond to Vikrant Maheshwari's query (which is last in the above trail), I have an identical query?

Regards,

Mansi Thakkar