# Merger & Amalgamation

> Companies merge through a scheme of arrangement approved by the NCLT under Sections 230–232 of the Companies Act, or through the faster Section 233 route for small companies, startups, holding–wholly-owned subsidiary combinations and other notified classes, which needs only Regional Director approval. For tax, an amalgamation meeting Section 2(1B) conditions is not a transfer (Section 47(vi)), and losses can carry forward under Section 72A where conditions are met.

Practice: Mergers, Acquisitions & Restructuring — https://www.industax.com/services/mergers-acquisitions/

Group simplification — merging dormant or wholly-owned subsidiaries into the parent — is the most common use, and the fast-track route can complete in a few months.

We draft the scheme with counsel, handle valuation and share exchange ratio where needed, file with the MCA/NCLT, and plan tax, stamp duty and post-merger integration of registrations.

## Key facts

| Item | Detail |
| --- | --- |
| NCLT route | Sections 230–232 |
| Fast track | Section 233 for notified classes |
| Tax | Section 47(vi), 2(1B) conditions; 72A for losses |
| Stamp duty | On the NCLT order, by state law |

## Who needs this

- Groups simplifying structures
- Companies merging with competitors
- Holding companies absorbing subsidiaries

## What's included

- Scheme design
- Valuation and swap ratio
- Approvals and filings
- Tax and stamp duty planning

## Documents

- Financial statements
- Shareholding and creditor details
- Board resolutions

## Process

1. **Design** — Scheme and route chosen.
2. **Approve** — Meetings, filings and orders.
3. **Integrate** — Registrations and books merged.

Work that legally requires a advocate is signed by a partner professional; Indus Tax coordinates it.

## FAQs

### How long does an NCLT merger take?

Usually six to twelve months, depending on the bench and objections. The fast-track route is typically faster.

### Is GST payable on a merger?

Transfer of business under a merger is generally not taxed as a supply in the usual way, and unutilised credit can be transferred, subject to filing ITC-02.

### Can the merged company use the transferor's losses?

Yes, for qualifying amalgamations under Section 72A, subject to conditions on continuing the business and holding assets.

## Official sources

- Ministry of Corporate Affairs: https://www.mca.gov.in/
- incometaxindia.gov.in: https://www.incometaxindia.gov.in/

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Canonical page: https://www.industax.com/services/mergers-acquisitions/merger-amalgamation
Publisher: Indus Tax — CA-led tax and compliance firm (https://www.industax.com). Contact: info@industax.com, 9059139258.
This is general information, not advice for your specific facts.