Definition of Slump sale :
“Slump sale‟ means the transfer of one or more undertakings as a result of the sale for a lump sum consideration without values being assigned to the individual assets and liabilities in such sales. If value of an asset or liability is determined for the sole purpose of payment of stamp duty, registration fees or other similar taxes or fees, that should not be regarded as assignment of values to individual assets and liabilities.
One question that arises in this context is whether in a situation where an undertaking is transferred against the allotment of shares in the acquiring company, the transaction would qualify as “slump sale” under the Income-tax Act, 1961. One view in this regard is that the transfer must necessarily be effected against a monetary consideration and a transfer against allotment of share is merely an “exchange” which will not qualify as a “sale”. However, a more reasonable view seems to be that the allotment of shares is merely a manner of discharge of consideration and the transaction would still qualify as a slump sale if other conditions are satisfied.