Ordinance likely for A-I, IA merger

New Delhi: The government is likely to introduce legislation or an ordinance to speed up the merger of state-owned carriers Indian Airlines and Air-India.
The proposed law would be to amend section 72A of the Income-Tax Act to allow the merged entity to carry forward the unabsorbed depreciation of the two airlines and set off previous years' losses against the profits of the new entity.
Besides, the proposed legislation will seek to exempt state-run carriers from coughing up Rs 300 crore as stamp duty to various state governments for integrating the operations and assets of the two carriers spread across the country.
The fastest way to merge the two would be the ordinance route, as was done in 1953 when the Air Corporation Act was repealed to create the two public sector airlines, the sources said. The alternative route would imply tabling the necessary legislation in the Budget session of Parliament.
03/01/07 Financial Express

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