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2025 (5) TMI 349 - AT - Income TaxValidity of assessement against non existent/amalgamating company - Appeal filed by the original assessee which was subsequently amalgamated into another entity - HELD THAT - After going through the reasons given by the NFAC relying the judgement Maruti Suzuki India Ltd. 2019 (7) TMI 1449 - SUPREME COURT BMA Capfin 2018 (12) TMI 1467 - SC ORDER and Sterlite Technologies Ltd. 2024 (5) TMI 397 - SC ORDER we are of the considered view that the aforesaid decisions are only laying down the law that the final assessment order and the order of the appellate authority should not be passed in the name of a non-existing entity. Where during the pendency of any proceedings the facts are brought on record of amalgamation then merely amendment of the title calling for amended Form No.35 would be sufficient. The ld. AR has explained that there is no provision in online portal to revise Form No.35 pursuant to merger and the e-appeal filing window is not activated in the portal of amalgamated entity i.e. IDP Education India Private Ltd.. Therefore NFAC should have been cognizant of these factual aspects also before dismissing the appeal in limine and should have considered the manually filed revised appeal in Form No.35 during the course of appellate proceedings in the name of amalgamated company The impugned order thus cannot be sustained. Consequently we sustain ground and allow the appeal of the assessee for statistical purposes.
1. ISSUES PRESENTED and CONSIDERED
The core legal questions considered by the Tribunal are:
2. ISSUE-WISE DETAILED ANALYSIS Delay in Filing the Appeal Legal Framework and Precedents: The Income Tax Act and judicial principles allow for condonation of delay if sufficient cause is shown and the delay is not of an exceptional period prejudicing the Revenue. Court's Interpretation and Reasoning: The appellant demonstrated that the delay occurred due to the appellate order email landing in the junk/spam folder, supported by an affidavit and email screenshot. The Tribunal found this explanation to be a sufficient cause. Application of Law to Facts: Given the reasonable cause and absence of prejudice to the Revenue, the Tribunal condoned the delay of 43 days. Conclusion: Delay in filing the appeal was condoned, and the appeal admitted for hearing. Maintainability of Appeal Post-Amalgamation Legal Framework and Precedents: The Tribunal referred to Supreme Court decisions in PCIT vs. Maruti Suzuki India Ltd., PCIT vs. BMA Capfin, and DCIT vs. Sterlite Technologies Ltd., which establish that assessment and appellate orders cannot be passed in the name of a non-existing entity. However, these precedents do not negate the possibility of continuing proceedings in the name of the amalgamated entity if the fact of amalgamation is brought on record during pendency. Court's Interpretation and Reasoning: The Tribunal observed that the appeal was originally filed by the assessee against whom the assessment order was passed. Subsequently, the amalgamation order was passed, effective retrospectively. The appellant duly informed the appellate authority (NFAC) about the amalgamation and filed a revised Form No.35. The appellate authority dismissed the appeal in limine, directing the appellant to file a fresh appeal in the name of the amalgamated entity, ignoring the fact that the amalgamation was brought on record and that the appellant had attempted to amend the appeal accordingly. Key Evidence and Findings: The amalgamation order dated 23.10.2023, effective from 01.04.2022, was on record. The appellant filed revised Form No.35 and submitted written submissions. The NFAC's dismissal was based on the premise that the original assessee no longer existed, without considering the revised submissions. Application of Law to Facts: The Tribunal held that the NFAC should have accepted the amended appeal in the name of the amalgamated company and proceeded with the appeal rather than dismissing it outright. The Tribunal also noted practical difficulties faced by the appellant, such as the online portal not allowing revision of Form No.35 or filing of an appeal in the name of the amalgamated entity due to technical constraints. Treatment of Competing Arguments: The Revenue relied on precedents emphasizing that orders cannot be passed in the name of a non-existing entity. The appellant argued that since the amalgamation was brought on record during pendency, the appeal should continue in the name of the amalgamated entity. The Tribunal sided with the appellant's interpretation, emphasizing procedural fairness and practical realities. Conclusion: The appeal filed by the original assessee could be continued and decided in the name of the amalgamated entity by accepting the amended Form No.35. The appellate authority's dismissal of the appeal in limine was not sustainable. 3. SIGNIFICANT HOLDINGS The Tribunal held that:
Core principles established include:
Final determinations:
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