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2022 (5) TMI 1490 - Tri - Companies LawScheme of Amalgamation - objections raised by the Income Tax Department - conditions laid down under Section 72A of the Income Tax Act, 1961, and also in Rule 9(C) of the Income Tax Rules, 1962, to qualify for carrying forward and set off unabsorbed business losses and unabsorbed depreciation of the amalgamating company in the hands of the amalgamated company. HELD THAT:- Even if a proposal of a Scheme of Amalgamation has been approved by the Adjudicating Authority, it is clarified that no provision of such a Scheme can override the existing provisions of the Income Tax Act. In any case, the above issues will come up for the consideration of the Assessing Officer at the time of assessment of the petitioner companies, and the Department can analyze the Scheme and is entitled to take any decision as per the provisions of the Income Tax Act on any issues including those discussed above. The Transferee Company has already submitted an undertaking in the form of an affidavit that it would extend its complete cooperation to the income tax authorities in any proceedings that exist/may arise post the sanction of the Scheme of Amalgamation by this Adjudicating Authority. As regards the provision of GAAR, the Income Tax Department is at liberty to invoke the provisions if the Assessing Officer during the course of assessment or reassessment proceedings, believes that GAAR should be invoked but the case will have to be referred to the Principal Commissioner or Commissioner of Income Tax, who in turn has to refer the matter to an Approving Panel in accordance with the provisions of Section 144BA of the Act. In view of the aforementioned discussions, we do not find enough merit in the objections raised by the Income Tax Department to justify any adverse inference with regard to the proposed Scheme of Amalgamation. The certificate of the Statutory Auditors with respect to the Scheme between Applicant Companies to the effect that the accounting treatment proposed in the Scheme is in compliance with applicable Indian Accounting Standards (Ind AS) as specified in Section 133 of the Act, read with Rules thereunder and other Generally Accepted Accounting Principles was filed as Annexure-14 of the petition. Scheme of amalgamation approved.
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