Operating losses can be carried forward for 3 years. Enterprises engaged in specified priority sectors may carry forward the losses for 5 years.
Carry back of losses is permitted in respect of income derived from completion of long-term contracts. A long-term contract can be manufacturing, installation or construction contract that cannot be completed in the same accounting year, in which it is commenced. However, in case of change in underlying ownership exceeding 50% at any time within a period of three years, losses are not permitted to be carried back to a period before the change in ownership took place.