AUBSP»Income Tax»Taxpayers»Section 35DD of Income-tax Act 1961-2017 – Amortisation of expenditure in case of amalgamation or demerger

Section 35DD of Income-tax Act 1961-2017 – Amortisation of expenditure in case of amalgamation or demerger

Detail analysis of the provisions of Section 35DD (Amortisation of expenditure in case of amalgamation or demerger) of Income-tax Act 1961 as amended by latest Finance Act 2017.

Chapter IV (Sections 14-59) of Income Tax Act, 1961 deals with provisions related to computation of total income. Section 35DD of Income Tax Act 1961-2017 provides Special provision for amortisation of expenditure in case of amalgamation or demerger.

(1) Where an assessee, being an Indian company, incurs any expenditure, on or after the 1st day of April, 1999, wholly and exclusively for the purposes of amalgamation or demerger of an undertaking, the assessee shall be allowed a deduction of an amount equal to one-fifth of such expenditure for each of the five successive previous years beginning with the previous year in which the amalgamation or demerger takes place.

(2) No deduction shall be allowed in respect of the expenditure mentioned in sub-section (1) under any other provision of this Act.

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