Invalidity of Income Tax Notice post-amalgamation; Fresh notice allowed; Impugned notices quashed. The Court found that the notice issued under Section 148 of the Income Tax Act, 1961 in the name of a transferee company post-amalgamation was legally ...
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Invalidity of Income Tax Notice post-amalgamation; Fresh notice allowed; Impugned notices quashed.
The Court found that the notice issued under Section 148 of the Income Tax Act, 1961 in the name of a transferee company post-amalgamation was legally invalid. The Court quashed the impugned notices and all subsequent actions based on them. The judgment clarified that while the notices were quashed due to being issued in the name of a non-existing entity, the respondents were allowed to issue a fresh notice in compliance with the law. The writ petition was disposed of accordingly.
Issues: Challenge to notice under Section 148 of the Income Tax Act, 1961 for assessment year 2015-2016 in the name of a transferee company post-amalgamation.
Analysis: The petitioner challenged the impugned notice dated 28th April, 2021, regarding the assessment year 2015-2016 under Section 148 of the Income Tax Act, 1961, issued in the name of a transferee company that had already been amalgamated on 16th September, 2019, with retrospective effect from 1st April, 2018. The petitioner argued that the department had been informed about this amalgamation on 9th December, 2019, making the notice in the name of a non-existing company legally untenable. The petitioner's counsel relied on a decision of the Gujarat High Court and a previous order of the same court to support their contention.
The Court, after hearing the arguments of both parties, held that the impugned notices dated 28th April, 2021, were not legally valid as they were issued in the name of a non-existing company post-amalgamation. Consequently, all further steps pursuant to the impugned notices were also deemed legally invalid and were quashed. The writ petition was allowed, and the impugned notices were quashed solely on the ground of being issued in the name of a non-existing entity. However, the judgment clarified that the quashing of the notice did not prevent the respondents from issuing a fresh notice in compliance with the law.
As no affidavits were called for, the Court deemed the allegations made in the writ petition to have been denied by the respondents. Consequently, the writ petition was disposed of, and the impugned notices were quashed, allowing the possibility for the respondents to issue a fresh notice in accordance with the law.
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