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2023 (8) TMI 1196 - HC - Income TaxValidity of reassessment u/s 148 - notices issued in the name of the non- existing entity - scheme of amalgamation approved - HELD THAT - As relying on case law cited for the petitioner in the case of Maruti SUZUKI India Limited 2019 (7) TMI 1449 - SUPREME COURT , Adani Wilmar Ltd. 2023 (2) TMI 864 - GUJARAT HIGH COURT and Inox Wind Energy Ltd. 2023 (3) TMI 723 - GUJARAT HIGH COURT , the ratio laid down in those judgements would squarely apply and since the notices for the assessment years 2014-15 to assessment years 2017-18 have been issued to the non-existing entity viz. Satyasarthi Estate Organisers Private Limited, such notices are quashed and set aside. Decided in favour of assessee.
Issues Involved:
1. Legality of notices issued under Section 148 of the Income Tax Act to a non-existent entity. 2. Availability of alternative efficacious remedy for the petitioner. 3. Validity of assessment proceedings against a non-existent entity post-amalgamation. Summary: Issue 1: Legality of Notices Issued to a Non-Existent Entity The petitioner argued that the notices under Section 148 of the Income Tax Act were issued to Satyasarthi Estate Organisers Pvt. Ltd., which had ceased to exist due to amalgamation with the petitioner company, Anokhi Realty Pvt. Ltd., effective from 01.04.2019. The jurisdictional officer was informed of the amalgamation through communications dated 07.08.2019 and 30.01.2020. The petitioner contended that the impugned notices were illegal as they were issued to a non-existent entity. The court, referencing the Supreme Court's decision in Maruti Suzuki India Ltd. and other relevant judgments, held that the issuance of notices to a non-existent company is fundamentally at odds with the legal principle that the amalgamating entity ceases to exist upon the approved scheme of amalgamation. Issue 2: Availability of Alternative Efficacious Remedy The respondent argued that the petitioner had an alternative efficacious remedy by way of an appeal to the CIT(A) and thereafter the Tribunal. However, the court found that the notices issued were without jurisdiction as they were directed to a non-existent entity, thus making the availability of an alternative remedy irrelevant in this context. Issue 3: Validity of Assessment Proceedings Against a Non-Existent Entity Post-Amalgamation The court examined the chronology of events and found that Satyasarthi Estate Organisers Pvt. Ltd. had amalgamated with Anokhi Realty Pvt. Ltd. effective from 01.04.2019. The jurisdictional officer was informed of this amalgamation, and the notices under Section 148 were issued between 29.03.2021 and 31.03.2021. The court held that the assessment proceedings against a non-existent entity are impermissible under the Income Tax Act. The court relied on various judgments, including those in the cases of Gauriputra Estate Holders Pvt. Ltd. and Maruti Suzuki India Ltd., to conclude that the notices issued were invalid. Conclusion: The court quashed and set aside the impugned notices issued under Section 148 of the Income Tax Act for the assessment years 2014-15 to 2017-18, as they were issued to a non-existent entity, Satyasarthi Estate Organisers Pvt. Ltd. The petition was allowed accordingly.
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