Reassessment proceedings against non-existing company after amalgamation are void, not merely procedurally defective

The Bombay HC held that reassessment proceedings conducted in the name of a non-existing company after court-approved amalgamation are void, not merely procedurally defective. Following precedents from Delhi HC in Spice Entertainment Ltd. and SC in Pr. CIT v. Maruti Suzuki India Ltd., the court ruled that once amalgamation is complete, the amalgamating entity ceases to exist and cannot be subject to assessment proceedings. The Revenue's argument that reassessment could be initiated for pre-amalgamation periods against a non-existent entity was rejected as legally untenable. The writ petition was allowed.

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Issues involved:
The petitioner challenges assessment orders, demand notices, and penalty notices for the years 2013-14 and 2014-15 due to being issued in the name of a non-existing company.

Assessment Year 2013-14:
- A notice under section 148 of the Income-tax Act, 1961 was issued against the non-existing company, despite being amalgamated with another entity.
- The Assessing Officer justified the reassessment proceedings based on a transaction before the amalgamation date.
- The High Courts approved the scheme of amalgamation, and the petitioner informed the Assessing Officer about the amalgamation.
- The assessment order and penalty notice were issued in the name of a non-existing entity, contrary to legal principles.

Legal Principles:
- The Supreme Court judgment in Saraswati Industrial Syndicate Ltd. v. CIT established principles of amalgamation.
- The Delhi High Court decision in Spice Entertainment Ltd. v. Commissioner of Service Tax emphasized that assessment orders in the name of non-existent companies are void.
- The Supreme Court in Pr. CIT v. Maruti Suzuki India Ltd. reiterated that jurisdiction cannot be invoked against an amalgamated entity that ceased to exist.

Decision:
- The High Court allowed the writ petition, setting aside all impugned notices, orders, and penalties related to the assessment years in question.
- The decision in one writ petition was applied to a companion writ petition, leading to the setting aside of related proceedings.
- Both writ petitions were disposed of accordingly.

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