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2024 (6) TMI 1426 - HC - Income TaxReassessment proceedings against non-existent entity - PAN number pertains to the company prior to the order of amalgamation that is no longer in existence in terms of the order of amalgamation - HELD THAT - It is to be noticed that the legal position stands settled by virtue of the order in the case of Principal Commissioner of Income Tax New Delhi v. Maruti Suzuki India Ltd. 2019 (7) TMI 1449 - SUPREME COURT wherein it is held that the notice and assessment order passed in the name of non-existing company is a substantive illegality and is an order passed without jurisdiction. Same has been followed by this Court in Coffee Day Resorts (MSM) Pvt. Ltd. 2023 (6) TMI 883 - KARNATAKA HIGH COURT Thus. the notice pertaining to the petitioner company having been issued to the non-existing company are one without jurisdiction and are set aside. Decided in favour of assessee.
In the case before the Karnataka High Court, presided over by Hon'ble Justice S. Sunil Dutt Yadav, the petitioner, M/s. Rajdisle Private Limited (bearing PAN No. AAECR5444G), challenged notices issued by the revenue authorities under Section 148A(b) of the Income Tax Act, 1961. These notices were addressed to a non-existent entity, M/s. Rajdisle Private Limited (bearing PAN No. AAICR2909J), which had ceased to exist following an amalgamation order by the National Company Law Tribunal on 25.03.2019. The amalgamation resulted in the transfer of property rights and powers to the transferee company, RJU Enterprises Private Limited, whose name was subsequently changed to Rajdisle Private Limited.
The court referenced the legal precedent set by the Supreme Court in Principal Commissioner of Income Tax, New Delhi v. Maruti Suzuki India Ltd., which established that notices and assessment orders issued in the name of a non-existent company constitute a "substantive illegality" and are "without jurisdiction." This principle was upheld in similar judgments, including Coffee Day Resorts (MSM) Pvt. Ltd. v. Deputy Commissioner of Income Tax. Consequently, the court set aside the notices issued to the non-existent entity for the assessment year 2020-21, citing lack of jurisdiction. However, the court granted the revenue authorities the liberty to initiate appropriate proceedings against the correct entity, the petitioner with PAN No. AAECR5444G, as per the law. All unresolved contentions were left open, and the petition was disposed of.
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