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2023 (5) TMI 627 - AT - Income TaxNon granting credit of TDS available in the erstwhile PAN of the amalgamating company - HELD THAT - As the order of the Hon ble Jurisdictional High Court approving the amalgamation is 21.01.2017 and subsequent to that, assessee ought to have made necessary arrangements and should have informed the customers of both the erstwhile companies to deduct the tax under new PAN but still some of the customers of the erstwhile Haldia Petrochemicals Limited have deposited TDS under the old PAN. Considering the fact that the claim of the assessee is valid and credit of the tax deducted at source has to be given to the assessee, we direct the ld. 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. Appeal of the assessee is allowed for statistical purposes.
Issues:
The judgment involves the issue of denial of credit for tax deducted at source available in the erstwhile PAN of the amalgamating company. Summary: The appeal was filed by the assessee against the order of the ld. Commissioner of Income Tax (Appeals) for the assessment year 2017-18. The grievance raised was the failure to grant credit for tax deducted at source available in the former PAN of the amalgamating company. The appellant, formerly known as M/s. Bengal Cracker Complex Limited, was amalgamated with erstwhile Haldia Petrochemicals Limited. The amalgamation was effective from 01.03.2015 as per the Scheme of Amalgamation approved by the Calcutta High Court. Post-amalgamation, the amalgamated company continued business activities under the name M/s. Haldia Petrochemicals Limited. For A.Y. 2017-18, tax was deducted at source under the former PAN of Haldia Petrochemicals Limited and claimed against the tax liability of the assessee under its new PAN. However, the Assessing Officer denied the claim as the TDS was not reflected in the 26AS under the new PAN. The assessee challenged this decision before the ld. CIT(Appeals), who directed the Assessing Officer to complete the migration of TDS credit from the old PAN to the new PAN of the amalgamated company. The CIT(A) allowed the ground for statistical purposes. The assessee appealed to the Tribunal seeking direction for the Assessing Officer to provide the tax credit within a specified timeframe. The Tribunal noted that the TDS amount was not in dispute, and the issue was the denial of credit. Despite the CIT(A) directing the Assessing Officer to complete the process, the Tribunal emphasized the need for timely resolution due to the technical nature of the issue. The Tribunal observed that the amalgamation was approved by the High Court in 2017, and the assessee should have informed customers to deduct tax under the new PAN. However, some customers continued to deposit TDS under the old PAN. Acknowledging the validity of the assessee's claim, the Tribunal directed the Assessing Officer to verify the TDS claim promptly and grant the credit within four months from the date of the order. The assessee was instructed not to delay the proceedings unless necessary for a reasonable cause. The appeal of the assessee was allowed for statistical purposes.
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