Due Diligence & Legal
Section 281 Tax Clearance
A no-objection certificate from the Income Tax Department confirming the seller has no pending dues that could otherwise render the asset transfer void under Section 281 of the Income Tax Act.
Buyer Example
Before closing a ₹15 Cr slump sale of a Ludhiana hosiery unit, the buyer insists on Section 281 clearance from the jurisdictional Assessing Officer — protecting against the tax department later declaring the transfer void and attaching the transferred assets to recover the seller's pre-existing tax arrears.