Assessment Order Void for Non-Existent Company: Tribunal Upholds CIT(A) Decision

The Tribunal upheld the decision of the Ld. CIT(A), ruling that the assessment order made in the name of a non-existent company was void and not curable under section 292B of the Income-tax Act. The Revenue's appeal was dismissed as the Assessing Officer failed to comply with directions under section 264, repeating the error and rendering the assessment invalid. The assessment order was quashed due to being issued in the name of a non-existent entity, with no legal infirmity found in the Ld. CIT(A)'s findings.

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Issues Involved:
1. Validity of the assessment order passed in the name of a non-existent company.
2. Compliance with directions under section 264 of the Income-tax Act, 1961.
3. Applicability of Section 292B of the Income-tax Act to cure the defect of assessment in the name of a non-existent entity.

Detailed Analysis:

1. Validity of the assessment order passed in the name of a non-existent company:

The Revenue appealed against the order of the Ld. CIT(A) which quashed the assessment order made in the name of M/s Pride Residency Private Limited, the amalgamated company. The facts reveal that the original assessment order was passed on 26/3/2013 under section 153A/143(3) of the Income-tax Act, 1961, assessing the income at Rs. 1,93,23,540/-. Subsequently, the assessee amalgamated with Pride Residency Private Limited, and this fact was communicated to the Assessing Officer. Despite this, the Assessing Officer issued notices and completed the assessment in the name of the non-existent company, which was held illegal and bad in law by the Ld. CIT(A).

2. Compliance with directions under section 264 of the Income-tax Act, 1961:

The Ld. PCIT, in an order dated 30/3/2015 under section 264, quashed the initial assessment made under section 153A, directing the Assessing Officer to reassess the income in the hands of the correct legal entity. Despite these directions, the Assessing Officer repeated the error by issuing notices and completing the assessment in the name of the non-existent company. The Ld. CIT(A) observed that the Assessing Officer was aware of the directions but failed to comply, rendering the assessment order void.

3. Applicability of Section 292B of the Income-tax Act to cure the defect of assessment in the name of a non-existent entity:

The Revenue argued that the error was curable under section 292B of the Act. However, the Tribunal referred to several case laws, including Pr. Commissioner of Income Tax-6 New Delhi Vs. Maruti Suzuki India Limited, Spice Entertainment Limited Vs. Commissioner of Income Tax, and others, which held that such a defect is not merely procedural and cannot be cured under section 292B. The assessment framed in the name of a non-existent entity is a nullity and void.

Conclusion:

The Tribunal upheld the Ld. CIT(A)'s decision, stating that the assessment order passed in the name of a non-existent company was void and could not be cured under section 292B. The Tribunal dismissed the Revenue's appeal, affirming that the Assessing Officer failed to comply with the directions under section 264 and repeated the earlier error, rendering the assessment invalid.

Judgment:

The appeal of the Revenue is dismissed. The reasoning and findings of the Ld. CIT(A) were upheld, and no legal infirmity or irregularity was found in the impugned order. The assessment order was quashed as it was made in the name of a non-existent company, which is not curable under section 292B of the Income-tax Act.

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