Change of company name does not create a new legal person, so third-party attachment notice to the bank remains valid.

A change of company name under the Companies Act does not create a new juristic person but leaves all rights, obligations and property vested in the same corporate entity; therefore funds held by a bank in the company's former name remain assets of that same company. Consequently a notice under section 46(5A) of the Income-tax Act addressed to a bank holding money for the assessee is effective to require payment and to operate as an attachment substitute where payment is not made. The practical effect is that tax recovery notices against holders of company funds survive a mere name change.

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Issues: Whether a notice under section 46(5A) of the Income-tax Act, 1922 seeking payment from a bank holding funds on behalf of a company whose name has changed is valid where the company has merely changed its name under section 11(5) of the Indian Companies Act, 1913.

Analysis: The Court examined the effect of a company's change of name under section 11(3) of the Indian Companies Act, 1913 and observed that a change of name does not create a new juristic person but merely alters the label of the same corporate entity; consequently all rights, obligations and property of the company continue to be those of the same company under its new name. Section 46(5A) of the Income-tax Act, 1922 authorises the Income-tax Officer to require any person who holds money for or on account of the assessee to pay specified sums to the Officer, and, on failure, to treat the notice as having the same effect as an attachment under the proviso to subsection (2) of section 46. The key factual and legal question was whether the bank held funds for the assessee (the company which formerly bore the old name). Given that assets held by the bank were assets of the same corporate entity now carrying a new name, the notice under section 46(5A) was properly addressed to the bank to realise the assessed tax.

Conclusion: In favour of Revenue.

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