TDS deducted in the name of company before amalgamation - how to claim credit

[Ashish Gupta]

In the year of 2006 (A) Pvt. Ltd. company was merged with (B) Ltd. company and after merger (A) amalgamating company was dissolved. Some parties of Amalgamating Company deducted TDS and filed quarterly TDS return mentioning PAN no. of Amalgamating Company and issued TDS Certificate bearing the PAN no. of Amalgamating company and therefore 26AS of Amalgamated company is not showing said tax credit instead of pointed out said fact they straightaway refused our request and not agreeing for filing revise return. Now my question is the TDS deposited in the PAN no. of Amalgamating company can be consider deposited to the account of amalgamated company as the fact of merger has also been informed to the Asst. Comm. of IT having jurisdiction over amalgamating company and after the amalgamation amalgamating company has been dissolved, in case of no then what ELSE remedy for us. Please provide your valuable reply.

[Surender Gupta]

The credit of TDS should be allowed to the amalgamated company. Your ground is sufficient when you show that the income has been included in the hands of amalgamated company. After merger the existence of amalgamating company is comes to an end. All the liabilities and benefits are being claimed by the amalgamated company. Though section 199 read with rule 37BA are salient on this issue, you would get the due credit.

AI Summary

TDS credit on pre merger deductions should follow the successor company where the income is included in its hands. TDS recorded under the PAN of an amalgamating company before merger should be credited to the amalgamated company when the relevant income has been included in the amalgamated company's hands; the amalgamating company ceases to exist and its liabilities and benefits pass to the successor, and documentary proof of merger and income inclusion together with reliance on the statutory and regulatory TDS framework support the claim for credit.