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Form 29 Under Income-tax Rules, 2026: Key Compliance Guide for Amalgamated Companies

Learn the key compliance requirements of Form 29 under the Income-tax Rules, 2026, including production benchmarks, filing obligations, and tax benefits for amalgamated companies.

—·2 min read
Form 29Income-tax Rules 2026amalgamated companiesRule 60Section 116(4)(b)(iii)tax compliancecarry forward lossesunabsorbed depreciationcorporate amalgamationincome tax filing

Form 29 Under Income-tax Rules, 2026

Introduction

Form 29 is an important compliance requirement under the Income-tax Rules, 2026 for amalgamated companies claiming tax benefits related to accumulated losses and unabsorbed depreciation. The form is prescribed under Rule 60 and is connected with Section 116(4)(b)(iii) of the Income-tax Act, 2025.

What is Form 29?

Form 29 is a certificate furnished by an amalgamated company to confirm that it has achieved and maintained the prescribed production level in the industrial undertaking acquired through amalgamation. It acts as proof that the undertaking continues productive operations after the merger.

Why Form 29 is Important

The form is necessary for companies that wish to claim the benefit of carry forward and set-off of accumulated losses and unabsorbed depreciation of the amalgamating company. Without proper filing, these tax benefits may be denied or withdrawn by the tax authorities.

Production Capacity Requirement

One of the major conditions under Rule 60 is that the amalgamated company must achieve at least 50% of the installed production capacity within four years from the date of amalgamation. The company must then continue maintaining this production level up to five years from the amalgamation date.

Filing Process

Form 29 must be filed electronically through the Income-tax portal along with the relevant return of income. The form must also be verified by an accountant and signed by the principal officer of the amalgamated company.

Documents Required

Companies should maintain proper records to support the information reported in Form 29. Important records include:

  • Books of account
  • Production records
  • Installed capacity details
  • Capacity utilization reports
  • Auditor verification documents

These documents may be reviewed during tax assessments.

Consequences of Non-Compliance

If the amalgamated company fails to meet the prescribed production conditions or does not file Form 29 correctly, the tax benefits under Section 116(4)(b)(iii) may be withdrawn. This can result in additional tax liability and recomputation of earlier claims.

Conclusion

Form 29 is a crucial compliance document for amalgamated companies under the Income-tax Rules, 2026. It ensures that companies claiming tax benefits continue operating the acquired industrial undertaking at the required production level. Proper documentation, timely filing, and continuous compliance are essential to avoid the loss of valuable tax benefits.