TaxTMI 
TaxTMI 
2017 (7) TMI 1044
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....ot file the necessary documents to substantiate its claim during the course of assessment proceedings. 3. On the facts and in the circumstances of the case and in law, the learned CIT(Appeals) has erred in directing the A.O to recalculate the disallowance u7s 14 A of the Act by taking investment of Rs. 2,20,00,520/- for earning exempt income as against Rs. 16,20,90,0207- taken by the A.O. 3.1. The Ld. CIT (A) ignored the finding recorded by the A.O and the fact that the amount of investment for earning exempt income was correctly taken by the A.O." 3. The assessee has raised the following grounds of appeal:- "1. The Appellant company Dhara Vegetable Oil and Foods Company Limited ("DOFCO'V'Appellant") (Now amalgamated with Mother Dairy Fruit & Vegetable Private Limited) filed its Return of Income for the captioned assessment year on October 26, 2007 declaring an income of Rs. Nil (after set-off of carried forward business loss and unabsorbed depreciation) and deemed income u/s 115JB of Rs.4,51,95,7257-. 2. The case was selected for scrutiny vide notice dated September 3, 2008 issued under section 142(1) of the Act. 3. Dhara Vegetable Oil and Foods Co. Ltd got ama....
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....thority however the same was dismissed by paragraph No. 2 of his order. It is further mentioned that the decision of the Ld. CIT (A) is contrary to the decision of the Hon'ble Supreme Court and jurisdictional High Court on this point. Consequently the assessee raised the following additional ground:- "that on the facts and in the circumstances of the case, the Ld. CIT (A) erred in law in holding that the assessment order passed by the Ld. assessing officer on 17th of August 2009 did not suffer from lack of jurisdiction and that he had made valid assessment in accordance with law." 5. The Ld. authorized representative vehemently submitted that the additional ground of appeal should be admitted as it goes to the root of the matter, it is a legal ground which can be raised at any point of time during the course of the hearing and in the interest of Justice this ground deserves to be admitted. He referred to the decision of the Hon'ble Supreme Court in case of NTPC Ltd to support his contention. 6. The Ld. departmental representative vehemently objected to the additional ground of appeal stating that this ground of appeal has not been raised in the original appeal memo filed by t....
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....rar of companies on 08/09/2008. 10. For the assessment year 2007 2008 the assessee filed its return of income showing income of Rs. 92884586/- on 26/10/2007 which was entirely set of against brought forward losses for earlier years. The assessment order placed before us was made on the assessee despite communication of the fact of amalgamation wide letter dated 6/10/ 2009 to him. Therefore the issue now before us is whether the assessment order made by the Ld. assessing officer is valid or not. 11. The Ld. authorized representative has relied upon the decision of the Hon'ble Supreme Court in case of Saraswati industrial syndicate versus CIT 186 ITR 278 (SC) wherein the Hon'ble Supreme Court held that on amalgamation the amalgamating company ceased to exist in the eye of the law. He further relied upon the decision of Hon'ble Delhi High Court in case of micron steels private limited 372 ITR 386 (del) and the decision of the Hon'ble Supreme Court in case of martial sons 223 ITR 809 (SC). 12. Ld. departmental representative submitted that there is no infirmity in the order passed by the Ld. assessing officer on the appellant company despite amalgamation. 13. We have carefully ....
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....) Ltd. and on the non-existent entity, viz Spice Corp Ltd. The Tribunal further held that the omission to mention the name of the amalgamated company in the assessment order was a mere procedural defect and, in terms of the provisions of Section 292B of the Act, such assessment was not invalid. In arriving at the aforesaid conclusion, the Tribunal laid emphasis on/the fact that there was sufficient representation and participation of the amalgamated company before the Assessing Officer during the course of the assessment proceedings, and that the Amalgamated company had preferred an appeal to CIT (A) against the assessment order. The Tribunal has accordingly remanded the file back to the Assessing Officer for framing afresh assessment in the name of the present appellant on the ground that framing of the assessment in the name of "Spice Corp Ltd" was a mere technical 'error. In this backdrop, the question that arises for consideration is as to whether the assessment in the name of a company which had been' amalgamated and had been dissolved with the said amalgamating company will be null and void or whether framing of assessment in the name of such a company is a mere procedura....
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....appeal and get the same decided on merits. In other words, any appeal/preferred by a non-existence person must also be treated as non-est. All these acts of the appellants/ amalgamated company clearly show that it had been constantly treated the assessment made against the appellant in respect of the assessment of amalgamated company. Further, no prejudice is caused to the assessee merely because in the body of the assessment order name of the amalgamated company is not shown. On the aforesaid reasoning and analysis, the Tribunal summed up the position in para 14 of its order which reads as under:- "In the light of the discussions made above, we, therefore, hold that the assessment made by the AG), in substance and effect, is not against the nonexistent amalgamating company. However, we do agree with the proposition or ration decided in the various cases relied upon by the learned counsel for the assessee that the assessment made against non existent person would be invalid and liable to be struck down. But, in the present case, we find that the assessment, in substance and effect, has been made against amalgamated company in respect of assessment of income of amalgamating company ....
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....er the order of the High Court in proceedings under Section 391 read with Section 394 of the Companies Act. The Saraswati Industrial Syndicate, the transferee Company was a subsidiary of the Indian Sugar Company, namely, the transferor Company. Under the scheme of amalgamation the Indian Sugar Company stood dissolved on 29th October, 1962 and it ceased to be in existence thereafter. Though the scheme provided that the transferee Company the Saraswati Industrial Syndicate Ltd. undertook to meet any liability of the Indian Sugar Company which that Company incurred or it could incur, any liability, before the dissolution or not thereafter. Generally, where only one Company is involved in change and the rights of the share holders and creditors are varied, it amounts to reconstruction or reorganization or scheme of arrangement. In amalgamation two or more companies are fused into one by merger or by taking over by another. Reconstruction or amalgamation has no precise legal meaning. The amalgamation is a blending of two or more existing undertakings into one undertaking, the share holders of each blending Company become substantially the share holders in the Company which is to carry o....
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....sessing Officer made the assessment in the name of M/s Spice which was non existing entity on that day. In such proceedings and assessment order passed/in the name of M/s Spice would clearly be void. Such a defect cannot be treated as procedural defect; Mere participation by the appellant would be of no effect as there is no estoppel against law. Once it is found that assessment is framed in the name of non-existing entity, it does not remain a procedural irregularity of the nature which could be cured by invoking the provisions of Section 292B of the Act. Section 292B of the Act reads as under:- "292B. No return of income assessment, notice, summons or other proceedings furnished or made or issue/or taken or purported to have been furnished or made or issued or taken in pursuance of any of the provisions of this Act shall be invalid or shall be deemed to be invalid merely by reasons of any mistake, defect or omission in such return of income; assessment, notice, summons or other proceeding if such return of income, assessment, notice, summons or other proceedings is in substance and effect in conformity with or according to the intent and purpose of this Act." The Punjab &Haryana ....
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....n bear her signatures and had not even been verified by her. In the aforesaid view of the matter, it is not possible for us to accept that the return allegedly filed by the assessee was in substance and effect in conformity with or according to the intent and purpose of this Act. Thus viewed, it is not possible for us to accept the contention advanced by the learned Counsel for the appellant on the basis of Section 292B of the 1961 Act. The return under reference, which had been taken into consideration by the Revenue, was an absolutely invalid return as it had a glaring inherent defect which could not be cured in spite of the deeming effect of Section 292B of the 196I Act." Likewise, in the case of Sri Nath Suresh Chand Ram Naresh Vs. CIT (2006) 280 ITR 396, the Allahabad High Court held that the issue of notice under Section 148 of the Income Tax Act is a condition precedent to the validity of any assessment order to be passed under section 147 of the Act and when such a notice is not issued and assessment made, such a defect cannot be treated as cured under Section 292B of the Act. The Court observed that this provision condones the invalidity which arises merely by mistake, def....