TMI Blog2019 (8) TMI 1331X X X X Extracts X X X X X X X X Extracts X X X X ..... sidered view that the Ld.CIT(A) has rightly directed the AO to allow carry forward and set off of MAT credit to the assessee and hence, we are inclined to uphold the findings of the Ld.CIT(A) and dismissed appeal filed by the revenue. - ITA No.2779/Mum/2018, C.O. No. 114/Mum/2019 (Arising out of ITA No.2779/Mum/2018) - - - Dated:- 28-8-2019 - Shri Sandeep Gosain, Judicial Member And Shri G. Manjunatha, Accountant Member For the Assessee : Rajan Vora Nikhil Tiwari For the Revenue : R. Manjunatha Swamy ORDER PER G.MANJUNATHA (A.M): This appeal filed by the revenue and cross objection filed by the assessee are directed against the order of the Commissioner of Income Tax (Appeals) 8, Mumbai dated 05/02/2018 and they pertains to the Assessment Year 2014-15. ITA.No.2779/Mum/2018:- 2. The revenue has raised the following grounds of appeal:- 1. Whether In the facts in the circumstances of the case and in law, the learned Commissioner of Income Tax(A) was right in directing the Assessing Officer to allow the carry forward and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f of MAT credit against the tax liability to the extent, it pertained to the SEZ unit of the assessee that were demerged to TCS Ltd. pursuant to a scheme of reorganization with effect from AY 2014-15, however, he allowed MAT credit only to the extent of ₹ 39,84,870/- and the balance amount of ₹ 9,87,98,743/- has been disallowed, while working out tax liability of the assessee. 5. Aggrieved by the assessment order, the assessee preferred an appeal before the Ld.CIT(A). Before the Ld.CIT(A), the assessee had filed a detailed written submissions on allowability of set off of carry forward of MAT credit in the hands of TCS e-serve International Ltd, in light of, the scheme approved by the Hon ble jurisdictional High Court of Mumbai. The Ld.CIT(A), after considering relevant facts and also taken note of observations of the Hon ble Bombay High Court held that all the tax, including income tax paid or payable by assessee shall be on account of TCS e-Serve International Ltd before the appointed date, ie. 01/04/2013 and after, the date of appointment, it will be to the account of TCS Ltd. Accordingly, the Ld.CIT(A) directed the AO to allow carry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... represents excess tax paid under MAT over the tax payable under the normal provisions of the Act by the assesse in the earlier years. Therefore, MAT credit available on account of excess payment of tax is that of the assessee itself and not of the demerged company. Further, the Hon ble Bombay High Court in its order approving, the scheme of demerger has categorically held that all the taxes, including income tax paid or payable by respondent shall be on account of TCS e-serve International Ltd, before the appointed date i.e 01/04/2013 and after, the date of appointment, it will be to the account of TCS Ltd. It is a settled position of law that any order passed by the High Court, including scheme of arrangement approved by the Hon ble High Court acquired statutory recognition, in case there is no specific provision is provided in the Act, in respect of carry forward and set off of MAT credit. In case of demerger, the law laid down by the Hon ble High Court, in the scheme of demerger would apply as operation of law. Therefore, we are of the considered view that even though, there is no specific provision is provided in the Act, in respect of carry forward and set off of MAT credit, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r unlisted private Ltd. Company into a limited liability partnership and in such circumstances, the arguments of the AO would have been relevant only if the MAT credit was claimed by the resulting company i.e. Ramrod Advisors Pvt. Ltd. But that is not the case here. Accordingly, we find no infirmity in the order of CIT(A) and this issue of the Revenue s appeal is also dismissed. 10. In this view of the matter and consistent with view taken by the Co-ordinate Bench, we are of the considered view that the Ld.CIT(A) has rightly directed the AO to allow carry forward and set off of MAT credit to the assessee and hence, we are inclined to uphold the findings of the Ld.CIT(A) and dismissed appeal filed by the revenue. Co.No. 114/Mum/2019 11. The assessee has raised following grounds of appeal in its cross objection:- 1. erred in challenging the order of the Commissioner of Income Tax (A)-8 [CIT(A) wherein CIT(A) after considering the directions of the Jurisdictions! High Court sanctioning the demerger schemes, held that the Respondent is eligible to carry forward and claim set-off of the MAT credit under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allow carry forward and set off of MAT credit to the assessee, but there is no specific finding, in respect of carry forward of balance unutilized MAT credit of ₹ 45,67,01,244/-. We find that the Ld.CIT(A) has categorically recorded finding in his appellate order regarding carry forward and set off of MAT credit and accordingly, directed the AO to allow MAT credit as claimed by the assessee. Once, the allowability of MAT credit has been decided in favour of the assessee, the remaining issue of carry forward and set off of MAT credit to subsequent years is consequential and the AO needs to verify, the fact with regard to availability of MAT credit, after setting off of such credit against tax liability of current year tax liability. Therefore, we are of the considered view that there is no dispute with regard to allowability MAT credit to the assessee, because we have already affirmed, the finding of Ld.CIT(A), in respect of allowability of set off of MAT credit availability to the assessee against its tax liability. In so far as, carry forward of unutilized MAT credit , the facts needs to be verified by the AO and accordingly, we set aside the issue to the file of the AO and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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