DCIT, New Delhi V. M/s. Servel India Pvt. Ltd., New Delhi

ITA 3928/DEL/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 7283 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 11 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-06-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC 3
• Next Hearing Date: 15-06-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 08-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K K JAISWAL
• Keywords: Scheme of amalgamation
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELATE TRIBUNAL DELHI BENCH SMC-3: NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER ITA NO. 3928/DEL/2014 A.Y. : 2010-11 DCIT, CIRCLE 8(1), VS. M/S SERVEL INDIA PVT. L TD. WARD-2, ROOM NO. 248, CR BLDG, S-15, OKHLA P HASE-II, IP ESTATE, NEW DELHI 2 NEW DELHI 20 (APPELLANT) (RESPONDENT) DEPARTMENT BY : SH. KK JAISWAL, SR. DR ASSESSEE BY : NONE DATE OF HEARING : 15-06-2016 DATE OF ORDER : 15-06-2016 O R D E R PER H.S. SIDHU, JM THIS APPEAL IS FILED BY THE REVENUE IS DIRECTED AG AINST THE ORDER DATED 30.4.2014 OF THE LD. CIT(A)-XI, NEW DELHI REL EVANT TO ASSESSMENT YEAR 2010-11 ON THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN ADMITTING THE ASSESSEES APPEAL. 2. THE APPELLANT CRAVES LEAVE TO AMEND MODIFY, ALTER, ADD OR FOREGO ANY GROUND(S) OF APPEAL AT ANY TIME BEFORE OR DURING THE HEARING OF THIS APPEAL. 2 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E FILED RETURN DECLARING AN INCOME OF RS. 5,39,450/- ON 15.10.2010 . THE ASSESSEE REVISED ITS RETURN ON 31.3.2012 DECLARING INCOME OF RS. 35,29,470/-. THE RETURN WAS PROCESSED U/S. 143(1) OF THE ACT. THE AS SESSEE HAS SHOWN INCOME FROM BUSINESS, OTHER SOURCES ETC. LATER, TH E CASE WAS SELECTED FOR SCRUTINY AND NOTICE U/S. 143(2) OF THE ACT WAS ISSU ED ON 27.9.2011. SUBSEQUENTLY, NOTICES U/S. 14291) WERE ALSO ISSUED. IN RESPONSE THERETO ASSESSEES AUTHORISED REPRESENTATIVE ATTENDED THE P ROCEEDINGS AND FILED THE DETAILS INCLUDING THE BOOKS OF ACCOUNT ALONGWIT H LEDGERS WHICH HAVE BEEN VERIFIED AND LEDGERS OF VARIOUS EXPENSES DEBIT ED UNDER VARIOUS HEAD IN THE P&L A/C HAVE BEEN TEST CHECKED. THEREAFTER, THE AO COMPLETED THE ASSESSMENT U/S. 143 OF THE I.T. ACT, 1961 AT AN INC OME OF RS. 3529,742/- VIDE ORDER DATED 15.2.2013. 3. AGGRIEVED BY THE AFORESAID ADDITION, ASSESSEE AP PEALED BEFORE THE LD. CIT(A) WHO VIDE IMPUGNED ORDER DATED 30.4.2014 HAS ALLOWED THE APPEAL OF THE ASSESSEE BY OBSERVING AS UNDER:- 7.1 THE FACTS OF THE CASE AND THE WRITTEN SUBMISSI ONS OF THE APPELLANT HAVE BEEN CAREFULLY CONSIDERED. THE APPEL LANT HAS NOT CHALLENGED THE ADDITION MADE BY THE AO ON ACCOU NT OF DISALLOWANCE ULS 14A OF THE ACT. THE ONLY GRIEVANCE WHICH IS RAISED AS A GROUND OF APPEAL BY THE APPELLANT IS I N RESPECT OF THE CREDIT OF TDS OF M/S SERVEL INDIA PVT. LTD., (T HE TRANSFEROR COMPANY) WHICH GOT AMALGAMATED WITH THE APPELLANT COMPANY IN TERMS OF AMALGAMATION ORDER OF THE HON'B LE DELHI 3 HIGH COURT. IT WAS ARGUED THAT THE TDS OF MIS SERVE L INDIA PVT. LTD. AMOUNTING TO RS. 15,57,985/- IS APPEARING IN FORM NO. 26AS IN THE SYSTEM OF THE DEPARTMENT. HOWEVER, SINCE ITS PAN IS DIFFERENT, THE AO HAS REFUSED TO GIVE CREDIT OF THE SAME TO THE APPELLANT COMPANY. IT IS OBSERVED THAT M/S S ERVEL INDIA PVT. LTD., (TRANSFEROR COMPANY) GOT AMALGAMATED INT O M/S SERVEL UDYOG PVT. LTD., (TRANSFEREE COMPANY) VIDE T HE SCHEME OF AMALGAMATION DULY APPROVED BY THE HON'BLE DELHI HIGH COURT. THE APPOINTED DATE OF SUCH SCHEME WAS 01.04. 2009. HOWEVER, THE EFFECTIVE DATE OF SUCH AMALGAMATION WA S THE DATE ON WHICH THE LAST, OF THE APPROVAL OR SANCTION SPECIFIED IN THE SCHEME WAS OBTAINED AND CERTIFIED COPIES OF THE ORDER OF HON'BLE HIGH COURT OF DELHI WAS FILED WITH ROC BY B OTH THE COMPANIES. IT HAS CLEARLY BEEN SPECIFIED IN CLAUSE 4.4 OF THE SCHEME OF AMALGAMATION THAT THE TDS/ADVANCE TAX PAI D BY THE TRANSFEROR COMPANY ASSESSABLE FOR THE PERIOD CO MMENCING FROM THE APPOINTED DATE (01.04.2009) SHALL BE DEEME D TO BE TDS/ADVANCE TAX PAID BY THE TRANSFEREE COMPANY AND CREDIT OF SUCH TDS/ADVANCE TAX SHALL BE ALLOWED TO THE TRA NSFEREE COMPANY NOTWITHSTANDING THAT THE CERTIFICATES/CHALL ANS FOR TDS/ADVANCE TAX ARE IN THE NAME OF THE TRANSFEROR C OMPANY AND NOT IN THE NAME OF THE TRANSFEREE COMPANY. SINC E THE SCHEME OF AMALGAMATION HAS ALREADY BEEN APPROVED BY THE HON'BLE DELHI HIGH COURT VIDE THEIR ORDER DATED. 10 .01.2012 IN 4 THE COMPANIES PETITION NO. 485/2010 CONNECTED WITH COMPANIES APPLICATION (M NO. 174/2010), THE AO IS D IRECTED TO GIVE CREDIT OF TDS IN RESPECT OF TRANSFEROR COMP ANY NAMELY MIS SERVEL INDIA PVT. LTD. INTERESTINGLY, THE APPEL LANT COMPANY HAS TAKEN OVER THE NAME OF TRANSFEROR COMPA NY AFTER THE AMALGAMATION BUT ITS PAN REMAINS THAT OF THE TRANSFEREE COMPANY VIZ. M/S SERVEL UDYOG PVT. LTD. THIS IS THE PRECISE REASON AS TO WHY THE AO WHILE GAVE CREDIT O F TDS MADE BY M/S SERVEL UDYOG PVT LTD. (TRANSFEREE COMPA NY) DURING THE INTERVENING PERIOD IN THE COMPUTATION OF TAX ON TOTAL INCOME OF DIFFERENTLY NAMED COMPANY BUT DID NOT ALLOW THE CREDIT OF THE TDS AS REQUESTED BY THE APPELLANT AS PAN OF APPELLANT COMPANY DID NOT MATCH WITH THE TRANSFEROR COMPANY. THEREFORE, THE AO IS DIRECTED TO GIVE CRED IT OF SUCH TDS BY GIVING EFFECT OF APPELLATE ORDER MANUALLY AN D NECESSARY STEPS FOR FORMALIZING THE CREDIT OF IDS I N THE SYSTEM MAY BE TAKEN BY THE AO IN CONSULTATION WITH THE DEP ARTMENTAL AUTHORITIES IN THIS REGARD. 8. IN THE RESULT, THE APPEAL IS ALLOWED. 4. AGAINST THE AFORESAID ORDER OF THE LD. CIT(A), R EVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 5 5. DURING THE HEARING, LD. DR RELIED UPON THE ORD ER PASSED BY THE AO AND REITERATED THE CONTENTIONS RAISED IN THE GROUN DS OF APPEAL BY THE DEPARTMENT. 6. IN THIS CASE, NOTICE OF HEARING TO THE ASSESSEE WAS SENT BY THE REGISTERED AD POST, IN SPITE OF THE SAME, ASSESSEE, NOR ITS AUTHORIZED REPRESENTATIVE APPEARED TO PROSECUTE THE MATTER IN DISPUTE, NOR FILED ANY APPLICATION FOR ADJOURNMENT. KEEPING IN VIEW THE F ACTS AND CIRCUMSTANCES OF THE PRESENT CASE AND THE ISSUE INV OLVED IN THE PRESENT APPEAL, I AM OF THE VIEW THAT NO USEFUL PURPOSE WOU LD BE SERVED TO ISSUE NOTICE AGAIN AND AGAIN TO THE ASSESSEE, THEREFORE, I AM DECIDING THE PRESENT APPEAL EXPARTE QUA ASSESSEE, AFTER HEARING THE LD. DR AND PERUSING THE RECORDS. 7. I HAVE HEARD BOTH THE PARTIES AND PERUSED THE RE CORDS, ESPECIALLY THE ORDER OF THE LD. FIRST APPELLATE AUTHORITY. AF TER PERUSING THE IMPUGNED ORDER OF THE LD. CIT(A), I FIND THAT LD. C IT(A) HAS PASSED A WELL REASONED AND SPEAKING ORDER BECAUSE ASSESSEE HAS NO T CHALLENGED THE ADDITION MADE BY THE AO ON ACCOUNT OF DISALLOWANCE ULS 14A OF THE ACT. THE ONLY GRIEVANCE IS IN RESPECT OF THE CREDIT OF T DS OF M/S SERVEL INDIA PVT. LTD., (THE TRANSFEROR COMPANY) WHICH GOT AMALG AMATED WITH THE ASSESSEE COMPANY IN TERMS OF HONBLE DELHI HIGH COU RT AMALGAMATION ORDER DATED 10.1.2012 IN THE COMPANIES PETITION NO. 485/2010 CONNECTED WITH COMPANIES APPLICATION (MA 174/2010). THEREFOR E, THE LD. CIT(A) HAS RIGHTLY DIRECTED THE AO TO GIVE CREDIT OF SUCH TDS BY GIVING EFFECT OF APPELLATE ORDER MANUALLY AND NECESSARY STEPS FOR FO RMALIZING THE CREDIT OF 6 TDS IN THE SYSTEM MAY BE TAKEN BY THE AO, IN CONSU LTATION WITH THE DEPARTMENTAL AUTHORITIES IN THIS REGARD, WHICH DOES NOT NEED ANY INTERFERENCE ON MY PART, HENCE, I UPHOLD THE ORDER OF THE LD. CIT(A) AND DISMISS THE APPEAL FILED BY THE REVENUE. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 15-06-2016. SD/- [H.S. SIDHU] JUDICIAL MEMBER DATE: 15/6/2016 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4.CIT (A) 5. D R, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES