Appellate Tribunal Grants TDS Credit to Transferee Company Post-Amalgamation, Overturns Previous Decision.

The Appellate Tribunal overturned the CIT(A)'s decision, directing the Assessing Officer to grant TDS credit of Rs. 3,31,880/- to the assessee. The Tribunal emphasized that post-amalgamation, all taxes, including TDS, of the transferor companies belonged to the transferee company from the appointed date. Thus, the appeal was allowed in favor of the assessee.

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Issues:
Appeal against denial of TDS credit post amalgamation.

Analysis:
The appeal was filed by the assessee against the order of the Commissioner of Income-tax (Appeals) upholding the Assessing Officer's denial of TDS credit amounting to Rs. 3,31,880/- to the amalgamated company after the transferor company was merged with the assessee. The amalgamation scheme was approved by the Calcutta High Court, and the assessee claimed the TDS credit in its return of income, which originally belonged to the merged entities before the amalgamation. The Assessing Officer denied the claim, resulting in a liability for the assessee. The Commissioner of Income-tax (Appeals) upheld the Assessing Officer's decision, stating that only assets were transferred, not the TDS.

Upon reviewing the case, the Appellate Tribunal noted that the amalgamation scheme approved by the High Court specified the appointed date as 01.10.2020 and stated that all taxes, including TDS, belonging to the transferor companies from that date onwards would be treated as belonging to the transferee company. The Tribunal referred to a Supreme Court decision emphasizing the importance of the specified date in an amalgamation scheme. The Tribunal found the assessee's claim genuine and supported by the law.

The Tribunal also examined Form 26AS of the amalgamating companies and found that TDS was deducted in the name of the transferee companies, which was deemed irrelevant post the appointed date of amalgamation. The Tribunal disagreed with the Commissioner's conclusion that only assets were transferred, emphasizing that post the appointed date, the TDS deducted in the transferor company's hands belonged to the transferee company. Consequently, the Tribunal set aside the Commissioner's order and directed the Assessing Officer to allow the TDS credit of Rs. 3,31,880/- to the assessee. As a result, the appeal filed by the assessee was allowed, and the decision was made in favor of the assessee.

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