NOTIFICATION

(Income Tax)

S.R.O.885(I)/2006.- In exercise of the powers conferred by sub-section (2) of section 53 of the Income Tax Ordinance, 2001 (XLIX of 2001), the Federal Government is pleased to direct that the following further amendment shall be made in the Second Schedule to the said Ordinance, namely:-

In the aforesaid Schedule, in Part IV, after clause (61), the following new clause shall be added, namely:-

“(62) The following provisions of Section 97 shall not apply in case of transfer of assets on amalgamation of companies or their businesses or acquisition of shares, requiring that transferor:

(a) be resident company; and

(b) belong to a wholly-owned group of resident companies.

Provided that:

(i) the transferee resident company shall own or acquire atleast 75% of the share capital of the transferor company or the business in Pakistan of the transferor company;

(ii) the amalgamated company is a company incorporated in Pakistan;

(iii) the assets of the amalgamating company or companies immediately before the amalgamation become the assets of the amalgamated company by virtue of the amalgamation, otherwise than by purchase of such assets by the amalgamated company or as a result of distribution of such assets to the amalgamated company after the winding up of the amalgamating company or companies;

(iv) the liabilities of the amalgamating company or companies immediately before the amalgamation become the liabilities of the amalgamated company by virtue of the amalgamation; and

(v) the scheme of amalgamation is sanctioned by the State Bank of Pakistan, any court or authority as may be required under the law.”

[C.No.4(41)ITP-S-2/2002]

(Salman Nabi)

Additional Secretary/Member (Direct Taxes)