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Gestetner (India) Ltd., Deputy Commissioner of Income-Tax Versus Assistant Commissioner of Income-Tax, Gestetner India Ltd, Deputy Commissioner of Income-Tax

2016 (2) TMI 1077 - ITAT KOLKATA

Reopening of assessment - assessment against non-existent company - Held that:- As the assessee company Gestetner (India) Ltd. got merged with RICOH India Ltd. w.e.f. 01.04.2005 by the orders of Hon’ble Calcutta High Court dated 22.06.2005 and Bombay High Court dated 30.06.2005, the assessments framed u/s. 143(3) for AY 2003-04 vide dated 15.03.2006 and for AY 2004-05 vide dated 08.12.2006 is on nonexistent person and hence, quashed. This legal issue is decided in favour of the assessee. - ITA N .....

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. Assessments were framed by ACIT/DCIT, Circle-1, Kolkata u/s. 143(3) of the Income-tax Act, 1961 (hereinafter referred to as "the Act") for Assessment Years 2003-04 & 2004-05 vide his orders dated 15.03.2006 and 08.12.2006 respectively. 2. In these four appeals, two by assessee and two by revenue, the Ld. Counsel for the assessee has raised additional ground that in both the assessment years i.e. 2003-04 and 2004-05 the assessment orders u/s. 143(3) of the Act dated 15.03.2006 and .....

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ia Limited with effect from 1st April, 2004. 2. That on the facts and in the circumstances of the case, the assessment order passed by the Assessing Officer under section 143(3) dated 15.03.2006 was bad in law, void ab initio and liable to be quashed." 3. Ld. Counsel for the assessee now before us stated that this fact of amalgamation was very much available that the assessee company Gestetner (India) Ltd. was merged with RICOH India Ltd. by the order of Hon ble Calcutta High Court dated 22 .....

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ule A hereto and doth hereby declare the same to be binding with effect from first day of April in the year two thousand and four (hereinafter referred to as the said appointed date) on the said transferee company and the said transferor company and their shareholders and all concerned." On query from the Bench, the Ld. Sr. DR fairly conceded the factual position and stated that yes the assessments were framed on a non-existent company i.e. Gestetner (India) Ltd. and whereas no assessment w .....

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order dated 08.12.2006 on a non-existent company. The AO was informed of this fact of amalgamation of the assessee with RICOH India Ltd. vide letter dated 25.01.2006, which is available in record of assessment. In view of the above facts, we find that this issue is covered by the decision of Hon ble Delhi High Court in the case of Spice Entertainment Ltd., supra, wherein Hon ble Delhi High Court has held as under: "10. Section 481 of the Companies Act provides for dissolution of the compan .....

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to the rights of another insured company was held not to be entitled to maintain an action in the name of the company after the latter had been dissolved". 11. After the sanction of the scheme on 11th April, 2004, the Spice ceases to exit w.e.f. 1st July, 2003. Even if Spice had filed the returns, it became incumbent upon the Income tax authorities to substitute the successor in place of the said dead person. When notice under Section 143 (2) was sent, the appellant/amalgamated company app .....

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is found that assessment is framed in the name of non-existing entity, it does not remain a procedural irregularity of the nature which could be cured by invoking the provisions ofSection 292B of the Act. Section 292B of the Act reads as under:- "292B. No return of income assessment, notice, summons or other proceedings furnished or made or issue or taken or purported to have been furnished or made or issued or taken in pursuance of any of the provisions of this Act shall be invalid or sha .....

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e reproduced provision makes it clear that a mistake, defect or omission in the return of income, assessment, notice, summons or other proceeding is not sufficient to invalidate an action taken by the competent authority, provided that such return of income, assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the provisions of the Act. To put it differently, Section 292B can be relied upon for resisting a challenge to the notice, etc., on .....

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d up before the Court in CIT Vs. Harjinder Kaur (2009) 222 CTR 254 (P&H). That was a case where return in question filed by the assessee was neither signed by the assessee nor verified in terms of the mandate of Section 140 of the Act. The Court was of the opinion that such a return cannot be treated as return even a return filed by the assessee and this inherent defect could not be cured inspite of the deeming effect of Section 292B of the Act. Therefore, the return was absolutely invalid a .....

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ance and effect is in conformity with or according to the intent and purpose of this Act". Insofar as the return under reference is concerned, in terms of Section 140 of the 1961 Act, the same cannot be treated to be even a return filed by the respondent assessee, as the same does not even bear her signatures and had not even been verified by her. In the aforesaid view of the matter, it is not possible for us to accept that the return allegedly filed by the assessee was in substance and eff .....

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the case of Sri Nath Suresh Chand Ram Naresh Vs. CIT (2006) 280 ITR 396, the Allahabad High Court held that the issue of notice under Section 148 of the Income Tax Act is a condition precedent to the validity of any assessment order to be passed under section 147 of the Act and when such a notice is not issued and assessment made, such a defect cannot be treated as cured under Section 292B of the Act. The Court observed that this provisions condones the invalidity which arises merely by mistake, .....

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