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TMI Blog2018 (4) TMI 1663X X X X Extracts X X X X X X X X Extracts X X X X ..... by it on 28.9.2010 declaring a loss of Rs. 4,21,61,955/-. During the course of assessment proceeding, a reference was made by the AO to the TPO for determining the arms' length price of the international transactions entered into by the assessee company with its associate enterprises. The TPO vide its order dated 17.01.2014 passed u/s 92CA(3) accordingly determined the arm's length price of the international transactions of the assessee company with its AE and proposed transfer pricing adjustment of Rs. 13,31,45,973/-. In the draft order passed u/s 143(3) read with section 144C of the Act on 28.2.2014, the addition on account of transfer pricing adjustments as suggested by the TPO was made by the AO to the total income of the assessee. Against the said draft order, objections were filed by the assessee company before the Dispute Resolution Panel (DRP). The DRP vide an order dated 23.09.2014 passed u/s 144C (5) of the Act disposed off the said objections by giving some specific directions to the TPO. As per the said directions of the DRP, the transfer pricing adjustment was recomputed by the TPO at Rs. 12,59,80,912/- and accordingly in the final order passed u/s 143(3) read with se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mension Apparels (P) Ltd. 370 ITR 288 (Delhi) 3. PCIT vs Maruti Suzuki 397 ITR 681 (Delhi) 5. The Ld. DR, on the other hand, contended that the order passed by the Ld. AO u/s 143(3) read with Section 144C in the name of an amalgamating company even after the date of amalgamation is valid as per the specific provisions contained in section 170(1) of the Act. He contended that as per the said provisions, the predecessor is liable to be assessed in respect of income up to date of succession and the successor is liable to be assessed only in respect of the income after the date of succession. He contended that the AO, therefore, was empowered to assess the predecessor being the amalgamating company in respect of income up to the date of succession. He contended that all the properties and liabilities of the amalgamating company have become the property and liability of the amalgamated company as a result of amalgamation and since the shareholders of not less than ¾ of the value of shares in the amalgamating company have also become shareholders of the amalgamated company, the provision of section 170(1) is squarely applicable. He contended that this specific provision however ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Genpact Infrastructure (Bhopal) Pvt. Ltd., a sister concern of the assessee for AY 2009-10 and vide its order dated 25.01.2018 passed in ITA No. 2025/Del/2014, the Tribunal admitted the additional ground and also decided the issue raised in the additional ground in favour of the assessee by quashing the order passed by the AO on 16.01.2013 in the name of Genpact Infrastructure (Bhopal) Pvt. Ltd. as the said entity was not in existence on 16.01.2013 having already been amalgamated with Genpact India with effect from April 1, 2010. 8. At the time of hearing before the Tribunal, the Ld. D/R has not disputed the position that the facts involved in the present case similar to the facts involved in the case of Genpact Infrastructure (Bhopal) Pvt. Ltd. (Supra) decided by the Tribunal. He however has contended that the order passed by the AO under section 143(3) read with section 144C in the name of amalgamated company being predecessor is valid as per the specific provisions contained in section 170(1) and the decision in the case of Genpact Infrastructure (Bhopal) Pvt. Ltd. (Supra) as well as other judicial pronouncements cited by the Ld. Counsel for the assessee in support of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s "Did ITAT misapply the provision of section 170(2) of the Income tax Act in the circumstances of the case while concluded that the assessment order was not tenable was having being amalgamated in the name of the non-existent company" ? Hon'ble Delhi High Court finally answered the question framed as above in the negative i.e. in favour of the assessee and against the revenue after discussing the various decisions already rendered by the Court on a similar issue making the legal position evidently clear. 10. It is thus clear that the preliminary issue involved in this case relating to the validity of the assessment made in the name of the amalgamating company being a non-existent entity is squarely covered in favour of the assessee by the various decisions of the Hon'ble Delhi High Court discussed above and atleast there of such decisions are rendered after taking into consideration the provisions of section 170(1) and 170(2). We therefore find no merit in the contention raised by the Ld. D/R in support of the revenue's case by relying on provision of section 170(1) and since the decision in the case of Genpact Infrastructure (Bhopal) Pvt. Ltd. (Supra) on a similar issue has b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken note of by the Hon'ble Delhi High Court in the case of Sky Light LLP (Supra) when the decisions of the Court in the case of Spice Enfotainment Ltd. and Dimension Apparel (Supra) were cited by the assessee in support of his case. In this regard, it was observed by the Hon'ble Delhi High Court in para no. 18 and 20 of its judgment that these were not the cases wherein notice u/s 147/148 of the Act was declared to be void and invalid but the same were the cases wherein the assessment order passed in the name of and against a juristic person, which had ceased to exist was held to be void and illegal. The Hon'ble Delhi High Court accordingly held that the cases of Spice Infotainment Ltd. and Dimension Apparels (Supra) were distinguishable. 12. As a result of our decision rendered above on a preliminary issue cancelling the assessment made by the AO u/s 143(3) read with section 144C by holding the same to be invalid, other grounds raised by the assessee in this appeal challenging the addition made by the AO in the said assessment on account of transfer pricing adjustment have become infructuous or academic. We therefore do not consider it necessary or expedient to adjudicate upon ..... 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