2016 (6) TMI 431

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... which an appeal preferred by the revenue was dismissed. The aggrieved revenue has come up in appeal. The facts and circumstances of the case, briefly stated, are as follows. Shaw Wallace Distilleries Ltd. filed their return of income on October 31, 2002 declaring total income at Rs. 7,17,54,000/-. Notice under section 142(1) was duly served. The General Manager(Finance) and other officers of the assessee duly appeared. The case was discussed and thereafter the assessment was completed under section 143(3) on March 31, 2005. The assessing officer made additions and also initiated proceedings under section 271. In an appeal preferred by the assessee, though the order of assessment was challenged on various grounds, the attack was restr....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....mbai and at the same time files return of income as an independent entity instead of a combined return of income of the amalgamated company and amalgamating company. It was further argued that the merger of the company was approved by the Hon'ble Court only on 26.3.03. Even after the order the company filed the return of income for assessment year 2003-04 separately with the Assessing Officer. For assessment year 2002-03, the return of income had been filed. The fact of the amalgamation was not referred to in the course of assessment proceedings. The assessment was allowed to be completed in the normal course. In this context, it was submitted, the omission to inform the department about the scheme of amalgamation proposed at the time of fi....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... the amalgamated company or its subsidiary) become shareholders of the amalgamated company by virtue of the amalgamation, otherwise than as a result of the acquisition of the property of one company by another company pursuant to the purchase of such property by the other company or as a result of the distribution of such property to the other company after the winding up of the firstmentioned company;" On a plain reading of the definition of the expression of "amalgamation", appearing in the Income Tax Act quoted above, the impression which one receives is that all the liabilities of the amalgamating company immediately before the amalgamation becomes become the liability of the amalgamated company. We are, in this case, concer....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... was no longer in existence. The contention was upheld up to the tribunal. In an appeal preferred by the revenue the Madras High Court held as follows:- "The failure on the part of the amalgamating company to distribute the statutory percentage of the accumulated profits is the foundation for the order passed by the Income-tax Officer under section 104. Such failure on the part of the amalgamating company is an omission which had within itself the potential for an order under section 104 being made against it, at any time within a period of four years. By proposing a scheme of amalgamation and amalgamating itself with the amalgamated company, the obligation to comply with an order under section 104 when made did not get wiped out. ....