TaxTMI 
TaxTMI 
2020 (2) TMI 1035
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....ate Limited. * The appellant craves leave to add, amend any/all the grounds of appeal before or during the course of hearing of the appeal. 2. The facts in brief of the case are that a search and seizure action under section 132 of the Income-tax Act, 1961 (in short 'the Act') was carried out at the premises of M/s. Satkar Fincap Private Limited on 07/08/2010 and assessment was completed under section 153A read with section 143(3) of the Act on 26/03/2013 at an income of Rs. 1,25,03,230/- by the Assistant Commissioner of Income-tax, Central Circle-13, New Delhi. The assessee filed appeal against the said order before the first appellate authority, which was subsequently withdrawn vide letter dated 20/11/2013 and accordingly dismissed by the learned First Appellate Authority as withdrawn. The assessee preferred Revision Application on 21/03/2014, under section 264 of the Act, before the Principal CIT, Central-2, New Delhi (DCIT), stating that the company, M/s Satkar Fincap P. Ltd. got amalgamated with M/s. Pride Residency Private Limited (i.e. the assessee), vide order dated 17/08/2012 of Hon'ble High Court of Delhi with effect from appointed date i.e. 01/04/2011, passed....
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....sallowance of expenses amounting to Rs. 33,76,450/-. The Learned CIT(Appeals)-II, Delhi confirmed the rejection of Books by the Assessing Officer and upheld the additions made by the Assessing Officer. The Hon'ble ITAT allowed the appeals of the Assessee. However, as informed by the Learned Counsel of the Appellant the Hon'ble High Court has restored the matter to the Hon'ble ITAT vide its Order passed in December, 2016. 8.3 Pursuant to the Search in the Sanskar Group, assessment in the case of the Assessee was completed u/s 153A r.w.s 143(3) of the I.T. Act on 26.03.2013 at an income of Rs. 1,25,03,230/-. The Assessee filed appeal against the said order which was subsequently withdrawn vide its letter dated 20.11.2013. The CIT(A)-2, New Delhi vide order dated 08.01.2014 disposed the appeal by dismissing it. The Assessee preferred revision application u/s 264 of the I.T. Act for the above A.Y. before the CIT Central-2, New Delhi on 21.03.2014. The Pr. CIT Central-2, New Delhi vide his order dated 30.03.2015 passed order u/s 264 of the I.T. Act quashed the assessment made by the Assessing Officer u/s 153A on technical grounds. The Learned Pr. CIT stated that the only error ....
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....oned Order u/s 250(6) of the Income Tax Act, 1961 dated 14.07.16 in Appeal No. 60/2013-14, by the Learned Commissioner of Income Tax (Appeals)-39, New Delhi shows that the Learned CIT (Appeals) had held that the impugned Order had been rendered void and had quashed the Assessment Order. The operative part of the Order dated 14.07.16 by the Learned CIT (Appeals)-39, in the case of M/s Satkar Fincap Ltd. (through Pride Residency Pvt. Ltd.) for A.Y. 09-10 is as under: "From records it can be safely gathered that the following issues arise from the impugned order- > Validity of the order as assessment is on amalgamating company > Disallowance of purchases u/s 69C (addition in sales u/s 68 subsumed) > Disallowance of expenditure 5.1 From records, it is observed that pursuant to the search u/s 132 on 07.08.2010, the Assessment Order was passed vide the impugned Order u/s 143(3)/153A. The assessment for AY 2009-10 has been made in the name of the Appellant - of its Income for the previous year (FY2008-09) relevant to AY 2009-10. Also, the proceedings u/s 153A of the Act has been initiated on the Appellant vide Notice dated 17/09/2012. In spite ....
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....Private Limited, ITA Nos. 725 to 728/2014, dated 26.11.2014 (Del) * Spice Entertainment Ltd. vs. CIT vs. ITA No. 475 of 2011 (03.08.2011)(Del) * Hewlett Packard India (P.) Ltd. Vs ACIT (ITA No. 4016 / 2005 A Y 2002-03) (ITAT. Del) 5.4 With due deference to the aforementioned decisions of the Courts including the Apex Court, the jurisdictional High Court and the jurisdictional Tribunal in this regard as well as the fact that the issue is identical to the one in the present case, and accordingly the impugned order is quashed for deviation from the laid down principles with regard to amalgamation - the income even though has been earned by the amalgamating company, but if the information regarding the amalgamation is available at the time of assessment, the assessment has to be done in the hands of the amalgamated company. In the present case, it is gathered from records that even though the return of Income has been filed by the appellant for AY 2009-10 before its amalgamation, as mentioned above, the assessment vide the impugned order is dated 26.03.2013 is much after the amalgamation but made in the name of the appellant which was an amalgamating company ....
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.... directions may be treated as directions u/s 150 of the I. T. Act, 1961." 8.12 The above directions issued by the Learned Principal CIT (Central)-2, New Delhi clearly specify that the assessment made by the Assessing Officer u/s 153A was quashed on technical grounds because the A.O. issued Notice and completed the assessment in the name of a non-existing company. Such conclusion was drawn by the Learned Principal CIT (Central)-2 as the Company had amalgamated, and on this basis he concluded that the Company had ceased to exist. Since the A.O. had issued the Notice and passed the Assessment Order in the name of such non-existing Company, the Assessment Order was quashed. 8.13 The Learned Principal CIT (Central)-2, New Delhi vide the abovementioned Order u/s 264, directed the Assessing Officer to reassess the Income in the hands of the "existing correct legal entity" after giving proper opportunity of being heard to the Assessee and after the examination, scrutiny of all the relevant material and verification. 8.14 It is noteworthy that not only the Assessing Officer was aware of such specific directions but has also reproduced such directions on page 1 & 2....
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....the case of Saraswati Industrial Syndicate Ltd. Vs CIT, 186 ITR 278 is particularly significant, as it has been held in that case that when two Companies amalgamate and merge into one, the transferor Company loses its entity as it ceases to have its business, and their respective rights or liabilities are determined under the scheme of amalgamation but the corporate entity of the transferor Company ceases to exist with effect from the date the amalgamation is made effective. 8.17 In the instant case, though the Assessing Officer had been directed u/s 264 to reassess the Income in the hands of the existing correct legal entity, and the Assessing Officer war aware of such directions and has even reproduced such directions in the Assessment Order, but still the Assessing Officer has repeated the same error, as earlier, i.e. of issuing Notice and completing the Assessment in the hands of a non-existing Company, which had ceased to exist after its amalgamation. That such amalgamation was prior to issue of Notice and completion of Assessment is clear from the Assessment Order itself as the process of Assessment had started pursuant to Order u/s 264, which itself made it clear th....
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.... that notice for revised assessment proceedings was issued on M/s. Satkar Fincap, which is not in existence on the date of issue of the notice, being already amalgamated with M/s. Pride Residency Private Limited with effect from 01/04/2011 and this fact was already within the knowledge of the ACIT, CC-13, New Delhi. The assessee has also disputed that PAN mentioned on the assessment order dated 23/03/2016 is belonging to M/s Satkar Fincap Private Limited, which is non-existent entity and thus assessment has been made on non-existent entity. The assessee in support of contention has relied on the decision of the Tribunal in assessment year 2007-08 in ITA No. 4176/Del./2017, whereas the Revenue has contested that error of issue notice in the name of non-existent entity and mentioning of incorrect PAN are mistake could be corrected u/s 292B of the Act in view of the decision of the Hon'ble Supreme Court in the case of Sky Light Hospitality LLP Vs. ACIT, in Special Leave to Appeal (c) No. 7409/2018. 7. But, in the instant case, we find another illegality, which has been referred by the Learned CIT(A). In this case, jurisdiction over the assessee, i.e., M/s Pride Residency Pvt. Ltd. ....