sumit sharma (CA-Service) (55 Points)
10 March 2012A company is having Deferred Tax Liability in it's balance sheet. Now, company decides to sales it's entire business by way of slump sale to another company. At transaction date also, company has DTL as per AS22.
My query is that
01. whether company should keep the DTL in their books knowing that this liability is not going to be reversed as the entire business is being sold.
02. Should company transfer the DTL balance to reserve as DTL is no more required.
Please suggest.
CA Smit
(Self Employed.)
(61 Points)
Replied 14 March 2012
It shall be written off at time of slump sale.
Kolluru Krishna Murty
(Partner)
(315 Points)
Replied 15 March 2012
Dear Friends,
Can it not be carried to the prospective business taker,since it is in the form of Carry forward loss etc,.
kkm
sumit sharma
(CA-Service)
(55 Points)
Replied 17 March 2012
Dear Smit
Dear KKM,
Thanks for your view. I think it should be written off as this pertains to one company (assessee), which is not going to do any business and therefore liability will not occur for tax in future also.
CAclubindia
