Case Law Details
Popular Complex Advisory Pvt. Ltd. Vs ITO (ITAT Kolkata)
The Income Tax Appellate Tribunal (ITAT) Kolkata heard the appeal in the case of Popular Complex Advisory Pvt. Ltd. vs. ITO regarding the eligibility of a transferee company to claim TDS (Tax Deducted at Source) credit in an amalgamation scheme. This article provides an overview of the case and its implications.
Background of the Case: This appeal was filed by Popular Complex Advisory Pvt. Ltd. (the assessee) against the order of the Learned Commissioner of Income-tax (Appeals) [Ld. CIT(A)] dated 24.04.2023 for the Assessment Year (AY) 2021-22. The central issue revolved around the denial of TDS credit to the amalgamated company after the transferor company’s amalgamation.
Scheme of Amalgamation: The case involved a scheme of amalgamation between multiple companies, including Bansidhar Commotrade Pvt. Ltd., Basudev Commosales Pvt. Ltd., Kanha Vincom Pvt. Ltd., Lilac Merchandise Pvt. Ltd., Narmoda Commercial Pvt. Ltd., and Pushkara Commosales Pvt. Ltd., with the assessee company, Popular Complex Advisory Pvt. Ltd. This amalgamation scheme was approved on 20.01.2022, with the appointed date being 01.10.2020.
Claim for TDS Credit: Pursuant to the amalgamation scheme’s Clause 16 of Part III, which stated that all taxes, including TDS, refunds, credits, claims, incentives, or other benefits belonging to the transferor companies from the appointed date onwards, would be treated as credits, claims, and tax benefits of the transferee company, the assessee claimed a TDS credit of Rs. 3,31,880/- in its return of income for the relevant assessment year. This TDS credit originally belonged to the four merged entities mentioned above.
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