Demerger

1. Shareholders holding 75% of the value of share become shareholders of the resulting company.
2. The resulting company issues shares to the shareholders of demerged company on a proportionate basis.
3. Gains arising out of transfer of assets is exempt in Capital gains tax as resulting company is Indian company.
4. Expenditure relating to demerger will be allowed as deduction equally for next 5 years.
5. Depreciation on assets of the resulting company will be calculated based on the number of days for which the assets have been held by the new company.
6. Actual cost of capital assets shall be the actual cost provided it dies not exceed
   
   

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