Amendments to the Finance Bill 2021 plug tax loophole in slump sale

Finance Minister Nirmala Sitharaman has plugged the loophole on sale of an undertaking by one entity or person to another, which may have repercussions for business transfers as well as mergers and acquisitions.
 
At present, consideration of slump sale is the amount agreed between seller and buyer, which often leads to leakage of tax. Slump sale refers to sale of an entire undertaking instead of individual assets.
 
Amendments to the finance Bill, 2021, say that fair market value (FMV) will be taken as consideration of the sale.
 
Current provisions sometimes result in a situation where valuable assets