2022 (11) TMI 1517 - AT - Income Tax

Validity of assessment order in the name of a non-existent entity - AO proceeded to pass the assessment order in the name of the erstwhile company/company amalgamating - HELD THAT - As respectfully applying the ratio laid down in case of PCIT Vs. Maruti Suzuki India Ltd. 2019 (7) TMI 1449 - SUPREME COURT we hold that assessment order, having been passed in the name of a non-existent entity, is invalid as assessment order passed in the name of a non-existent entity is equivalent to passing an order in the name of dead person, hence, is invalid. Decided in favour of assessee. Accordingly, it is quashed. The impugned order of learned Commissioner (Appeals) is hereby set aside. Assessee appeal allowed.

Summary

Issues:
Validity of assessment order passed in the name of a non-existent entity.

Analysis:
The judgment pertains to cross-appeals arising from an order of the Commissioner of Income Tax (Appeals) for the assessment year 2005-06. The main issue raised in the appeal is the validity of the assessment order passed in the name of a non-existent entity. The assessee contended that despite the amalgamation of two companies and the intimation provided to the Assessing Officer, the assessment order was still issued in the name of the erstwhile company. The assessee argued that this rendered the assessment order invalid. The Departmental Representative, on the other hand, argued that since the assessee did not file a revised return mentioning the new name, the assessment order in the old name was not fatal. The Tribunal considered the crucial dates and events related to the amalgamation and the assessment order. It noted that the assessment order was passed after the amalgamation took effect, and the Assessing Officer was duly informed about it. The Tribunal relied on the Supreme Court's decision in PCIT Vs. Maruti Suzuki India Ltd., which held that an assessment order passed in the name of a non-existent entity is equivalent to passing an order in the name of a dead person and is therefore invalid.

The Tribunal distinguished this case from the decision cited by the Departmental Representative, where the assessee had not intimated the Assessing Officer about the amalgamation. In the present case, the Tribunal found that the assessee had provided all necessary information to the Assessing Officer regarding the amalgamation. Therefore, the Tribunal held that the assessment order passed in the name of a non-existent entity was invalid and quashed it. Consequently, the order of the Commissioner (Appeals) was set aside. As a result of this decision, the Revenue's appeal was dismissed, while the assessee's appeal was allowed. The judgment was pronounced on November 30, 2022.