CARRY FORWARD AND SET OFF OF LOSSES IN THE CASE OF CERTAIN COMPANIES.
Notwithstanding
anything contained in this Chapter, where a change in shareholding has
taken place in a previous year in the case of a company, not being a company
in which the public are substantially interested, no loss incurred in
any year prior to the previous year shall be carried forward and set off
against the income of the previous year unless – (a) On the last
day of the previous year the shares of the company carrying not less than
fifty-one per cent of the voting power were beneficially held by persons
who beneficially held shares of the company carrying not less than fifty-one
per cent of the voting power on the last day of the year or years in which
the loss was incurred :
Provided
that nothing contained in this section shall apply to a case where a change
in the said voting power takes place in a previous year consequent upon
the death of a shareholder or on account of transfer of shares by way
of gift to any relative of the shareholder making such gift.
Provided
further that nothing contained in this section shall apply to any change
in the shareholding of an Indian company which is a subsidiary of a foreign
company as a result of amalgamation or demerger of a foreign company subject
to the condition that fifty-one per cent shareholders of the amalgamating
or demerged foreign company continue to be the shareholders of the amalgamated
or the resulting foreign company.
