TMI Blog2019 (9) TMI 726X X X X Extracts X X X X X X X X Extracts X X X X ..... . Undisputedly, learned CIT has exercised the power under section 263 of the Act on the issue of allowance of MAT credit relating to Ambuja Cement Eastern Ltd. which amalgamated with the assessee company. It is the reasoning of learned CIT that the provisions of section 115JAA of the Act allows set off of MAT credit only in respect of company in whose case such MAT credit has arisen. According to her, carry forward of MAT credit of amalgamating company cannot be allowed in case of amalgamated company. On a reading of the provisions of section 115JAA of the Act, we do not find any such restriction with regard to allowance of MAT credit of an amalgamating company at the hands of the amalgamated company. Rather, a plain reading of the aforesaid provision reveals that MAT credit is allowed to be carried forward for a specific period. In case of Skol Breweries Ltd. [ 2011 (3) TMI 578 - ITAT, MUMBAI] while deciding identical issue has held that carried forward MAT credit of the amalgamating company can be claimed by the amalgamated company. In view the assessment order passed in case of amalgamating company the principle which emerges is, the carried forward MAT credit of am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od thus, learned CIT, in exercise of power under section 263 of the Act called for and examined the assessment records of the assessee. After examining the assessment records, she found that MAT credit of ₹ 6,99,46,873 (wrongly shown at ₹ 13,13,48,364 in the show cause notice issued under section 263 of the Act) pertains to Ambuja Cement Eastern Ltd. which amalgamated with the assessee. Being of the view that MAT credit of the amalgamating company is not admissible for deduction at the hands of the assessee under section 115JAA of the Act, learned CIT issued notice dated 23rd February 2018, requiring the assessee to explain why the assessment order allowing MAT credit of the amalgamating company should not be held as erroneous and prejudicial to the interests of revenue. In response to the aforesaid show cause notice, the assessee filed a detailed reply on 12th March 2018, stating that as per the provision of section 115JAA of the Act, there is no restriction in allowing the carried forward MAT credit of the amalgamating company, since, by virtue of amalgamation, the assessee steps into the shoes of amalgamating company. Thus, it was submitted, carried ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Commissioner (Appeals) cannot be revised under section 263 of the Act. In support of the aforesaid contention, the learned Counsel relied upon the following decisions: i) CIT v/s Alagendran Finance Ltd., [2007] 293 ITR 001 (SC); ii) CIT v/s ICICI Bank Ltd., [2012] 343 ITR 74 (Bom.); iii) CIT v/s Lark Chemicals Ltd., [2014] 368 ITR 655 (Bom.); iv) CIT v/s Dena Bank, ITA no.2412/2013 (Bom.); and v) CIT v/s Infosys Technologies Ltd., 341 ITR 290 (Kar.). 5. Further, the learned Counsel for the assessee submitted, there is no error in the decision of the Assessing Officer in allowing MAT credit of amalgamating company. Therefore, one of the conditions of section 263 of the Act is not satisfied. The learned Counsel drawing our attention to section 115JAA of the Act submitted, there is no restriction in the said provision to not allow MAT credit relating to amalgamating company. He submitted, even various judicial precedents have also held the aforesaid view. In this context, he drew our attention to the following decisions of the Tribunal: i) Skol Brewerie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing MAT credit of ₹ 58,10,53,744, pertaining to the assessment year 2006 07. While deciding the aforesaid ground, learned Commissioner (Appeals), in Para 27.1 of order dated 22nd August 2013, has observed as under: There is no discussion in respect of this issue in the assessment order of the AO. However, AO is directed to verify facts from records and allow credit as per Law. 9. It is further evident, while giving effect to the aforesaid order of learned Commissioner (Appeals), the Assessing Officer, in order dated 13th April 2015, has allowed MAT credit of ₹ 20,12,95,237 paid for the assessment year 2006 07. Admittedly, the aforesaid MAT credit comprises of ₹ 6,99,46,873 relating to Ambuja Cement Eastern Ltd., which amalgamated with the assessee by virtue of order dated 21st November 2006, passed by the Hon ble Gujarat High Court and MAT credit of ₹ 13,13,48,364, relating to the assessee. Therefore, assessee s contention that the limitation should be counted from the original assessment order passed on 22nd December 2010, in our view, is unacceptable. As regards the contention of learned Authorised Representative that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... carried forward for a specific period. In case of Skol Breweries Ltd. (supra), the Tribunal, Mumbai Bench, while deciding identical issue has held that carried forward MAT credit of the amalgamating company can be claimed by the amalgamated company. Similar view has been expressed by the Tribunal, Ahmedabad Bench, in Adani Gas Ltd. (supra). If we consider the issue in the light of the ratio laid down in the aforesaid decisions, there cannot be two opinions that the assessee is entitled to claim carried forward MAT credit of the amalgamating company Ambuja Cement Eastern Ltd. It is necessary to observe, while completing the assessment in case of the amalgamating company Ambuja Cement Eastern Ltd. in Assessment Year 2006-07, the Assessing Officer has also concluded that carried forward MAT credit of Ambuja Cement Eastern Ltd. would be available in the hands of the present assessee. Keeping in view the assessment order passed in case of amalgamating company as well as the decisions referred to above, the principle which emerges is, the carried forward MAT credit of amalgamating company can be taken credit of by amalgamated company. Viewed in the aforesaid perspective ..... X X X X Extracts X X X X X X X X Extracts X X X X
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