ITAT directs credit of TDS appearing in old PAN of amalgamating company

ITAT directs credit of TDS appearing in old PAN of amalgamating company to amalgamated company with another PAN

ABCAUS Case Law Citation:
ABCAUS 3711 (2023) (04) ITAT

In the instant case, the assessee had challenged the order passed by the CIT(A) in confirming not granting the credit of tax deducted at source (TDS) available in the erstwhile PAN of the amalgamating company.

The appellant-assessee was a limited company. Vide a Scheme of Amalgamation duly approved by the order of the Hon’ble High Court, another company merged with the assessee-company.

Post amalgamation, the amalgamated company continued the business activity with the changed name but with old PAN.

For the Assessment Year in question, income tax was deducted at source under the PAN of the merged company was claimed against the tax liability of the assessee-company in the return of income. 

However, while processing the return, the Assessing Officer denied the claim of the said TDS due to TDS mismatch since TDS was not appearing in the 26AS under the PAN of the appellant assessee.

The CIT(A) opined that the migration of TDS credit from the old PAN to the PAN of the amalgamated company is to be completed by the AO/department. The AO was directed to pursue the matter of migration with so that the assessee gets full TDS credit. 

Not satisfied with the order of the CIT(A), the assessee approached the ITAT with prayer is to direct the jurisdictional Assessing Officer to provide the tax credit within a time frame so that the necessary action is taken and the issue is not be kept in abeyance.

The Tribunal observed that subsequent to the amalgamation,  the assessee ought to have made necessary arrangements and should have informed the customers of both the  erstwhile  companies  to  deduct  the  tax  under  correct PAN, but still some of the customers of the erstwhile company have deposited TDS under the old PAN.

The Tribunal further noted that the amount of TDS was not in dispute and only not allowing its credit was under challenge.  

Accordingly, the ITAT directed the Assessing Officer to carry out the necessary verification process at the earliest and after being satisfied about TDS claim of the assessee to grant the credit within four months from the date of receiving this order and also direct  the assessee not to delay the aforesaid proceedings by taking  adjournment  unless  otherwise  required  for  reasonable cause for filing of necessary details. 

Download Full Judgment Click Here >>

• ITAT held 2000 gram jewellery reasonable in view of customary practices & CBDT Instruction
• Documents obtained post search & information obtained from public domain not incriminating material
• No second reopening for unexplained credits in bank due to bank’s name change
• FDCM invites application for empanelment of practising CAs/ Chartered Accountant Firms
• PGRI invites application for CAs for empanelment for Circulation Verification work