Merger – Filing of ITRs and Section 170A Compliance

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Executive
65 Points Joined May 2025

Dear Experts,

Company B Pvt. Ltd. has been merged into Company A Pvt. Ltd. with the following details:

  • Appointed Date: 01/04/2023

  • NCLT Order Date: 20/11/2024

  • Effective Date (as per NCLT Order): 01/01/2025

  • Company B continued to operate independently up to 31/12/2024.

Additional info: Company B is a profit-making entity with no carry forward of losses.

Based on this, I have a few questions regarding income tax return (ITR) filing and compliance under Section 170A:

  1. Does Company A need to file a separate ITR for FY 2024–25?

  2. Does Company B need to file a separate ITR for FY 2024–25?

  3. For which financial years is Company A required to file a modified return under Section 170A?

  4. If Company A is not required to file a separate ITR for FY 2024–25, would filing a return under Section 170A alone be sufficient?

  5. Given that Company B is profit-making and has no carry forward of losses, does that change the ITR filing requirements in any way?

Regards,

S Ram

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On 25 June 2025 at 10:56 Report
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Master in Accounts & high court Advocate
8883 Points Joined December 2011

Let's address your questions regarding the merger of Company B Pvt. Ltd. into Company A Pvt. Ltd. and the income tax implications:

 *1. Separate ITR Filing for Company A:* Company A would typically need to file a separate ITR for FY 2024-25, covering the period from April 1, 2024, to March 31, 2025.

 However, considering the merger specifics, especially the effective date (January 1, 2025), Company A might need to file a return that includes the income of both companies from January 1, 2025, onwards. *2.

Separate ITR Filing for Company B:* Company B, being an independent entity until December 31, 2024, would need to file a separate ITR for FY 2024-25, covering its income up to December 31, 2024.

*3. Modified Return under Section 170A:* Company A would be required to file a modified return under Section 170A for the financial years preceding the effective date of the merger (January 1, 2025).

 This would likely apply to FY 2023-24 if the returns for that year were already filed before the merger became effective.

*4. Sufficiency of Filing under Section 170A:* If Company A is not required to file a separate ITR for FY 2024-25 for the period before the merger, filing a return under Section 170A might be sufficient for reporting the amalgamation and related tax implications.

However, this depends on the specifics of the merger and tax laws.

*5. Impact of Company B Being Profit-Making:* Given that Company B is profit-making and has no carry-forward losses, the primary focus would be on ensuring that both companies comply with tax filing requirements accurately.

The profit-making status doesn't necessarily alter the ITR filing requirements but ensures that tax liabilities are appropriately accounted for in the returns. .

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On 25 June 2025 at 13:25
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Executive
65 Points Joined May 2025

Dear Rama-sir,

Thanks for your detailed response.

Regards,

S Ram

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On 26 June 2025 at 08:56


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