TMI Blog2006 (3) TMI 227X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed as infructuous. In the result ITA No. 211/Del/2001 is allowed and all the other appeals and the cross-objection are dismissed. - HON BLE P. M. JAGTAP., N. V. VASUDEVAN. For the Assessee : Ajay Vohra, Ms. Rashmi Kapoor For the Revenue : P. V. Rao ORDER N.V. VASUDEVAN, J.M.: 1. All the above appeals arise out of assessment in the case of the assessee for the asst. yr. 1996-97. 2. We shall first take up for consideration ground No. 1 raised by the assessee in ITA No. 211/Del/2001 which reads as follows: That the learned CIT(A) has erred on facts and in law in upholding the order of assessment passed by the Jt. CIT, S.R., Moradabad making assessment in the hands of Calcutta Instalments (P) Ltd. which company stands dissolved w.e.f. 16th May, 1996 pursuant to the orders of Hon'ble Delhi High Court on its amalgamation with Modifin (P) Ltd. and is a non-entity from the above date. She has failed to appreciate that the assessment made on a non-entity is null and void. 3. There was a company by name M/s Calcutta Instalments (P) Ltd. This company was in the business of leasing and investments. There was a scheme of amalgamation by which M/s Calcutta Instalments (P) Ltd. and severa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consolidated accordingly, and (5) That any person interested shall be at liberty to apply to the Court in the above matter for any directions that may be necessary, (6) The scheme of amalgamation as approved and confirmed by this Court will be effective from 16th May, 1996, i.e., the appointed date in terms of the scheme. 4. Another company by name M/s Indian Management Advisors Leasing (P) Ltd. along with its subsidiary namely, IRS Investments (P) Ltd. also sought to amalgamate with Modifin (P) Ltd. w.e.f. 16th May, 1996 under the same scheme of amalgamation. Since the registered office of these two transferor-companies were in Delhi, a petition was filed for sanctioning the scheme before the Hon'ble Delhi High Court. The Hon'ble Delhi High Court sanctioned the scheme of amalgamation in the case of Indian Management Advisors Leasing (P) Ltd., IRS Investments (P) Ltd. and Modifin (P) Ltd. vide its order dt. 10th Dec., 1996. As already mentioned, the Allahabad High Court has already sanctioned the scheme of amalgamation in the case of other four transferor-companies i.e., Delhi Holdings (P) Ltd., Helm Holdings (P) Ltd., Dunes Investments (P) Ltd. and Calcutta Instalments (P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent year's return has been filed and assessed in the name of the appellant-company. Therefore, the action of the AO is upheld. This ground of appeal is dismissed. 8. Apart from challenging the order of the CIT(A) upholding the validity of assessment in the name of M/s Calcutta Instalments (P) Ltd. the assessee has also challenged the various additions made by the AO which were sustained by the CIT(A). And the assessee is in appeal in this regard in ITA No. 211/Del/2001. The Revenue has filed ITA No. 511/Del/2000 aggrieved by the various reliefs which were granted by the CIT(A) to the assessee. 9. It may also be relevant to point out that the CIT(A) remanded certain issues to the AO for fresh consideration and the AO on such remand confirmed some of the additions which he had originally made. Against such order passed by the AO, the assessee preferred appeal before the CIT(A), who by his order dt. 19th Sept., 2002 granted certain reliefs to the assessee and confirmed some of the additions made by the AO. Against the reliefs granted by the CIT(A), the Revenue has preferred ITA No. 4724/Del/2002. The assessee has filed a cross-objection, i.e., C.O. 43/Del/2005 in which he has agit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TR (Pat) 80 : (1987) 164 ITR 323 (Pat) (v) CIT vs. Fatelal (1996) 88 Taxman 320 (MP) (vi) CIT vs. Kumari Prabhawati Gupta Ors. (1997) 142 CTR (MP) 72 (vii) R.C. Jain vs. CIT (2004) 190 CTR (Del) 34 : (2004) 140 Taxman 379 (Del) (viii) Braham Prakash vs. ITO (2004) 192 CTR (Del) 190 (ix) CIT vs. Ram Das Deokinandan Prasad (HUF) (2005) 193 CTR (All) 453 : (2005) 277 ITR 197 (All) Issue of notice to dead person: Notice issued to a person who is dead or nonexistent could not form the basis of framing an assessment and any assessment so framed would be a nullity and of no consequence. 11. The learned Departmental Representative relied on the order of the CIT(A). We have considered the rival submissions The question whether after dissolution of a company and after the intimation of such dissolution with the RoC, an assessment can be made on a dissolved company had come up for consideration in several decisions. In the case of CIT VS. Express Newspapers Ltd. the facts were as follows. Free Press of India (Madras) Ltd., a private limited company (hereinafter referred to as the Free Press Company) was carrying on business as printers and publishers of certain newspapers, namely, the Indian ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax. It will be seen that, by that time, the company had been struck off from the register of companies as early as 12th July, 1948. Thereupon, the ITO, Second Circle, Madras, who had by then succeeded the officer who made the assessment initiated (with the previous approval of the CIT) proceedings under s. 34 r/w s. 26(2) against the Express Company. The notice was issued on the footing that there had been a succession to the business of the Free Press Company by the Express Company, and that the latter would, as the successor, be liable to be assessed to tax for the assessment year. The ITO held, by his order dt. 4th April, 1951, that the Express Company would be liable to pay the tax under s. 26(2) of the Act, as the person succeeded, namely, the Free Press Company, was not in existence, and could not be found. Following the order under s. 26(2), the officer made an assessment of the taxable income at Rs. 6,44,802. The question before the Court was whether notice of reassessment against M/s Express Company was valid, which question would again depend on the question whether the assessment on M/s Free Press Company after it was dissolved was valid. The Court held as follows: To ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... res Ltd., had been assessed to income-tax on a total income of Rs. 1,45,143 and the Rajputana General Dealers Ltd., had been assessed to income-tax on a total income of Rs. 1,14,417. Later on, the ITO found that the two companies had not declared any dividends and he was of opinion that proceedings had to be initiated against these companies under s. 23A of the Indian IT Act, 1922, for the asst. yr. 1960-61. He therefore, proceeded to issue notices in the names of the two companies and in reply thereto a chartered accountant appeared and objected to the proceedings on the merits. However, after hearing the representative who appeared, the ITO passed an order dt. 2nd March, 1965, in the case of M/s Merchandise and Stores Ltd., demanding an additional super-tax of Rs. 40,135 under s. 23A. On the same date, he similarly determined the additional super-tax payable by the other company, i.e., M/s Rajputana General Dealers Ltd., at Rs. 31,465 In both the orders, the names of the assessee were given as M/s Merchandise and Stores Ltd., and M/s Rajputana General Dealers Ltd., respectively. One of the questions for consideration before the Court was as to whether Delhi High Court was compete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. In the appeal before the Tribunal one of the questions that arose for consideration was as to whether a company whose name was struck off the register by RoC under s. 560 of Companies Act, 1956 and therefore, stood dissolved, could be assessed to tax after dissolution? The Tribunal held that existence of the person sought to be taxed fat the point of making the assessment is a condition for the validity of the assessment. The Tribunal referred to the decision of the Hon'ble Bombay High Court in the case of Patiala State Bank, In re (1941) 9 ITR 95 (Bom) wherein it was held that tax is not imposed on income generally. It is imposed on the income of a person, natural or artificial, as defined in s. 3. The Tribunal thereafter, referred to the various provisions in the IT Act, 1961, for initiating proceedings for assessment of income in the case of death of different assessees. In the case of a company which is in liquidation, the provisions of s. 178 of the Act providing for assessment in the hands of a liquidator, was referred to. The Tribunal then referred to the distinction in law between liquidation and winding up and ultimately concluded that there was no provision under t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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