s.148 notices to reopen tax assessments against companies dissolved after amalgamation lack jurisdiction when assessments were already passed

HC held that notices issued under s.148 to reopen assessments against companies that ceased to exist post-amalgamation were without jurisdiction. Because assessments for the year had already been passed in the name of the appropriate assessees and the Department was aware of the amalgamations, the reopening notices were untenable. The petitions were allowed and the impugned s.148 notices were quashed and set aside, decision recorded in favour of the assessee.

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Issues: Whether notices issued under Section 148 of the Income-tax Act, 1961 after sanctioned amalgamation and against erstwhile companies (which ceased to exist) are valid or are without jurisdiction and liable to be quashed.

Analysis: The facts show that amalgamation orders had been sanctioned and taken effect before issuance of the impugned notices, and the assessing authority was aware of the amalgamations. The legal framework includes Section 170 on succession to business on amalgamation, and Section 292B addressing mistakes in notices and proceedings. Judicial precedent distinguishes between mere procedural/technical defects curable under Section 292B and substantive jurisdictional infirmities where the assessee named in the notice has ceased to exist post-amalgamation. Where the amalgamating entity has ceased to exist pursuant to an approved scheme and the successor is identifiable, issuance of a notice in the name of the non-existing predecessor may amount to a jurisdictional defect not remediable merely as a procedural mistake. Prior decisions apply this distinction and support quashing notices issued to non-existent entities despite participation in proceedings when such participation does not cure the jurisdictional defect arising from corporate death on amalgamation.

Conclusion: The notices issued under Section 148 after the sanctioned amalgamations and in the name of erstwhile companies that had ceased to exist are without jurisdiction and are quashed. Relief is granted in favour of the assessee.

Ratio Decidendi: A notice under Section 148 issued in the name of an entity that has ceased to exist pursuant to an approved amalgamation is a jurisdictional defect and cannot be sustained merely as a curable procedural mistake; such notices are invalid and liable to be quashed where the amalgamation has taken effect and the assessing authority was aware of it.

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