TaxTMI 
TaxTMI 
2022 (12) TMI 524
X X X X Extracts X X X X
X X X X Extracts X X X X
....of Hon'ble Supreme Court in case of PCIT vs. Maruti Suzuki India Ltd. reported in (2019) 107 taxmann.com 375 wherein the Hon'ble Supreme Court has held that an income that was sought to be subjected to the charge of tax for the year was the income of the erstwhile entity prior to amalgamation. Under an approved scheme of amalgamation Hon'ble Supreme Court held that the transferee has assumed the liabilities of the transferor company, including tax liabilities. The consequence of the scheme of amalgamation approved u/s. 394 of the Companies Act, 1956 was that the amalgamating company ceased to exist. Hon'ble Supreme Court has held that upon the amalgamating company ceasing to exist, it cannot be regarded as a person u/s. 2(31) against whom assessment proceedings can be initiated or an assessment order would be passed. Hon'ble Supreme Court has noted that a notice issued u/s. 143(2) was issued to the amalgamating company followed by the notice u/s. 142(1) prior to the scheme of amalgamation being approved, the assessing officer subsequently cannot initiate assessment proceedings against an entity that ceased to exist. Hon'ble Supreme Court in that relevant facts held that a notice is....
X X X X Extracts X X X X
X X X X Extracts X X X X
....April 1, 2012. • The scheme provided that all the assets, liabilities and duties of the amalgamating company be transferred to the MSIL and that the SPIL would stand dissolved without winding up. • On April 2, 2013 - the Assessee informed the AO that SPIL has amalgamated with MSIL. • On September 26, 2013 , the AO issued notice u/s.143(2) for AY 2011-12. • On September 4, 2015, the AO issued letters to the Assessee with the following description:- "The Principal Officer M/s Suzuki Powertrain India Limited (Now known as M/s Maruti Suzuki India Limited)" • On March 11, 2016, the AO passed draft assessment order in the name of SPIL. • On April 12, 2016, the Assessee filed objections against the proposed additions in the draft assessment order before the Dispute Resolution Panel (DRP).The objections were filed by MSIL as successor in interest of erstwhile SPIL. • On October 14, 2016, DRP gave its directions to the AO on the objections to the draft assessment order of the AO. • On October 31, 2016, the AO passed the final order in the name of SPIL (amalgamated with MSIL). ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he date when the AO passed the order of assessment, assessment so framed is not sustainable in the eyes of law, being a nullity. The Hon'ble Supreme Court in the case of M/s.Maruti Suzuki India Ltd. (supra), also dealt with the decision of the Hon'ble Delhi High Court in case of Sky Light Hospitality LLP vs. ACIT reported in (2018) 405 ITR 296 observed as under: "27. The submission however which has been urged on behalf of the Revenue is that a contrary position emerges from the decision of the Delhi High Court in Skylight Hospitality LLP which was affirmed on 6 April 2018 by a two judge Bench of this Court consisting of Hon'ble Mr Justice A K Sikri and Hon'ble Mr Justice Ashok Bhushan33. In assessing the merits of the above submission, it is necessary to extract the order dated 6 April 2018 of this Court: "In the peculiar facts of this case, we are convinced that wrong name given in the notice was merely a clerical error which could be corrected under Section 292B of the Income Tax Act. The special leave petition is dismissed. Pending applications stand disposed of." Now, it is evident from the above extract that it was in t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... addressed to M/s. Skylight Hospitality Pvt. Ltd., a company which had been dissolved, was an error and technical lapse on the part of the respondent. No prejudice was caused." 28. The decision in Spice Entertainment was distinguished with the following observations: "19. Petitioner relies on Spice Infotainment Ltd. v. Commissioner of Service Tax, (2012) 247 CTR 500.Spice Corp. Ltd., the company that had filed the return, had amalgamated with another company. After notice under Section 147/148 of the Act was issued and received in the name of Spice Corp. Ltd., the Assessing Officer was informed about amalgamation but the Assessment Order was passed in the name of the amalgamated company and not in the name of amalgamating company. In the said situation, the amalgamating company had filed an appeal and issue of validity of Assessment Order was raised and examined. It was held that the assessment order was invalid. This was not a case wherein notice under Section 147/148 of the Act was declared to be void and invalid but a case in which assessment order was passed in the name of and against a juristic person which had ceased to exist and stood dissolved as per provi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ity LLP on the other hand." 12. Respectfully following the decision of Hon'ble Supreme Court in case of PCIT vs. Maruti Suzuki India Ltd.(supra), we hold that, since the assessee ceased to be in existence as on the date when the Ld.AO passed the impugned order of assessment, the assessment so framed is not sustainable in the eye of law. The final order of assessment is therefore liable to be annulled, and is hereby annulled. Accordingly, the assessee's appeal stands allowed on the legal issue raised in ground no. 2. 13. As we have decided the legal issue in favour of assessee, the issues alleged by assessee on merits is left open for academic purposes. In the result, the appeal filed by the assessee stands allowed. Order pronounced in open court on 13th July, 2022. ============= Document 1 marlabs % 15 December 2017 ITO Ward 4(1)(3), BMTC Building, Koramangala Bangalore-560005 Dear Sir/Madam, Sub: Reason for non-filing of the return of Income of Marlabs Software Solutions Pvt. Ltd for Assessment Year 2017-18 Ref: Scheme of Amalgamation Order of merger passed by the National Company Law Tribunal Bengaluru Bench delivered on 05 ....