TMI Blog2016 (6) TMI 431X X X X Extracts X X X X X X X X Extracts X X X X ..... ion took place with effect from November 2002. There is, as such, no dispute on fact that it is a liability of the amalgamating company which accrued prior to the amalgamation. The assessee maintained a studied silence and did not bring to the notice of the revenue, in particular the assessing officer, about the amalgamation sanctioned by the High Court at Mumbai on March 26, 2003. The assessee not only did not bring this fact to the notice of the assessing officer, the assessee also filed a return for the assessment year 2003-04. Therefore, the assessee itself did not act upon the amalgamation. Be that as it may, by reason of the amalgamation, the order passed on 31st March, 2005, pertaining to the assessment year 2002-2003 could not have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... additions and also initiated proceedings under section 271. In an appeal preferred by the assessee, though the order of assessment was challenged on various grounds, the attack was restricted to the point as to whether the assessment order was a nullity. The contention of the assessee was that the assessment order passed on March 31, 2005 was a nullity because the assessee had merged with Maharashtra Distilleries Ltd. pursuant to an order passed by the High Court at Mumbai on March 2, 2003. The question was whether the assessment order passed on March 31, 2005 was a nullity. This question has been answered against the revenue both by the CIT (Appeal) and the learned Tribunal. The revenue has come up in appeal. We already have indicated t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as allowed to be completed in the normal course. In this context, it was submitted, the omission to inform the department about the scheme of amalgamation proposed at the time of filing the return is an important matter for consideration. By filing the return of income and by going along with the assessment proceedings as an unamalgamated entity to the extent of filing the appeal against the assessment order also, the appellant asserted its claim to be an assessable entity. The aforesaid portion has been quoted by us from the order of the CIT(Appeal). Amalgamation has been defined under section 2(1B) of the Income Tax Act, which reads as follows: (1B) amalgamation in relation to companies, means the merger of one or more com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll the liabilities of the amalgamating company immediately before the amalgamation becomes become the liability of the amalgamated company. We are, in this case, concerned, with the assessment year 2002-03, i.e. to say pertaining to the financial year which ended on March 31, 2002, whereas the amalgamation took place with effect from November 2002. There is, as such, no dispute on fact that it is a liability of the amalgamating company which accrued prior to the amalgamation. The assessee maintained a studied silence and did not bring to the notice of the revenue, in particular the assessing officer, about the amalgamation sanctioned by the High Court at Mumbai on March 26, 2003. The assessee not only did not bring this fact to the notice o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me of amalgamation and amalgamating itself with the amalgamated company, the obligation to comply with an order under section 104 when made did not get wiped out. That obligation became the obligation of the amalgamated company. The dissolution of the amalgamating company thereafter was not an event of any relevance and had no effect on the obligation which had been taken over by the amalgamated company in terms of the order of amalgamation. One of the consequences of amalgamation was that the amalgamating company became incapable of having the benefit of section 105. Had it continued to exist it would have had the option of distributing the undistributed profits, thereby avoiding the liability to tax under section 104. That circumsta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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