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2018 (1) TMI 140 - AT - Income TaxValidity of assessment against non existent company - assessment in the name of a company which had been amalgamated and had been dissolved with the said amalgamating company - Held that:- In the case before us, we find that the returns were filed by the amalgamating company and the notices u/s 143(2) & 142(1) were issued probably to the assessee prior to amalgamation, therefore the scrutiny assessments were validly initiated, but the assessment order is passed on a non-entity. Therefore, in our opinion, the assessment proceedings cannot be held to be invalid ab initio. The AO can proceed with the assessment proceedings, by transposing the amalgamated company as the assessee and issuing fresh notice u/s 142(1) of the Act and complete the assessment proceedings. AO is directed accordingly. Failure to pass a draft assessment order under Section 144C - Held that:- We find that when the issues were set aside by the Tribunal, it is not merely for correcting mathematical errors in the calculations, but it is for reconsidering the issue in accordance with the directions of the ITAT. Wherever, the AO/TPO exercise their discretion after verification, and pass an order, it is incumbent upon them to give the assessee an opportunity to present its case or to appeal against such orders. It is for this reason that the statues provide that the AO shall pass a draft assessment order against which the assessee can either choose to file its objection before the DRP or choose to file an appeal before the CIT (A) and after the assessee exercises its option, the AO can pass the final assessment order in accordance with the directions of the DRP or the assessee can file an appeal before the CIT (A). As per section 144C of the Act, the AO first has to pass the draft assessment order and the choice is with the assessee either to approach the DRP or the CIT (A). Only if the assessee chooses to prefer an appeal before the CIT (A), can the AO pass the final assessment order. Similar facts had arisen in the case of JCB India Ltd (2017 (9) TMI 673 - DELHI HIGH COURT) before the Hon'ble Delhi High Court and the Hon'ble High Court has held that even in the case of a remand by the Tribunal, the AO has to pass a draft assessment order and not the final assessment order
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