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TMI Blog2019 (12) TMI 1241X X X X Extracts X X X X X X X X Extracts X X X X ..... three companies viz. Gayatri Mine-Chem Private Limited, Gayatri Integrated Services Private Limited and Gayatri Fillers Private Limited inter alia praying for sanction of composite scheme of arrangement in the nature of amalgamation with the petitioner company under the provisions of the Companies Act. During the said proceedings before this court, the Regional Director, North-Western Region, Ministry of Corporate Affairs, had filed his affidavit dated 13th May, 2015. In response whereof, additional affidavit was filed inter alia providing explanation to the issues raised by the Regional Director, Ministry of Corporate Affairs. As per one of the explanations, objection was invited from the Income Tax Department; however, within the statutory period of 15 days, no objection was raised by the Income Tax Department and it was presumed that the Income Tax Department, had no objection to the proposed scheme of arrangement. 2.2 Thereafter, this court upon being satisfied that the amalgamation under the scheme was in the interest of the companies, sanctioned the composite scheme of arrangement vide order dated 18th June, 2015. As a result whereof, the three companies viz. Gayatri Mine- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h August, 2019, the respondent issued a show-cause notice calling upon Gayatri Integrated Services Private Limited to show cause as to why the assessment for the year 2012-13 should not be finalised ex-parte under the provisions of section 144 of the Act on the basis of material available on record. Gayatri Integrated Services Private Limited was also informed that as to why penalty proceedings under clause (b) of subsection (1) of section 271 of the Act should not be initiated separately for failure on its part. 2.8 It appears that Gayatri Integrated Services Private Limited requested for some time so as to enable it to respond to the show-cause notice. It is the case of the petitioner that on 7th August, 2019 itself, the respondent issued a notice under section 274 read with section 271F of the Act calling upon Gayatri Integrated Services Private Limited, to show cause as to why order imposing penalty should not be made under the provisions of section 271F of the Act, since it had failed to furnish the return of the income as required under the provisions of sub-section (1) of section 139 of the Act . 3. Being aggrieved, the petitioner has filed the present petition with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at once the company ceases to exist, it is not amenable to the assessment proceedings under the provisions of the Act. 5.2 It is further submitted that the respondent though was requested to provide the copy of the reasons recorded, he had not provided the same. The respondent without providing the copy of the reasons recorded, proceeded further with the assessment proceedings by issuing notice under section 142 of the Act. It is further submitted that the respondent ought to have provided the copy of the reasons recorded so as to enable the petitioner to file its objection. It is only after offering an opportunity to the petitioner to file its objection and rendering his decision thereon, that it was open to the respondent to proceed further with the assessment proceedings. 5.3 It is further submitted that the respondent ought not to have issued the notice dated 7th August, 2019 under the provisions of section 271 of the Act inasmuch as, Gayatri Integrated Services Private Limited had filed its return for the assessment year 2012-13 under the provisions of section 139 of the Act and thus, the respondent had no jurisdiction or authority to issue the notice under section 271 rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mann.com 81 (Delhi - Tribunal). 6. As against this, Ms. Mauna Bhatt, learned Senior Standing Counsel for the respondent submitted that the procedure for issuance of the notice under the provisions of section 148 of the Act has been duly complied with and that there is no procedural irregularity. In the absence of any illegality, the notice issued under section 148 of the Act is a valid and legal notice. 7. Having heard the learned counsel for the respective parties, it emerges from the record that this court, under the provisions of the Companies Act, has vide order dated 18th June, 2015, sanctioned the composite scheme of arrangement in the nature of amalgamation of the three transferor companies viz. Gayatri Mine-Chem Private Limited, Gayatri Integrated Services Private Limited and Gayatri Fillers Private with the petitioner that is, Gayatri Microns Limited, the transferee company. Pertinently, amalgamation took place, much prior to the issuance of notice dated 25th March, 2019 for reopening the assessment. Thereafter the petitioner informed the respondent about the said amalgamation of all the three companies with the petitioner. The record reveals that the factum of amalgam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngineering Limited (supra) held that once the assessee company gets amalgamated with the transferee company, its independent existence does not survive and therefore it would no longer be amenable to the assessment proceedings. Thus, it is well settled proposition of law that upon its amalgamation the transferor company ceases to exist and becomes extinct, and it would no longer be amenable to the assessment proceedings considering the fact that the extinct entity would not be covered within the ambit of the provisions of the Act.
11. Accordingly, in view of the aforesaid concluded proposition of law; which applies on all fours to the facts of the present case, the notice dated 25th March, 2019 issued by the respondent under the provisions of section 148 of the Act for the assessment year 2012-13, being without jurisdiction, is not sustainable.
12. For the foregoing reasons, the petition succeeds and is accordingly so allowed. The impugned notice dated 25th March, 2019 issued by the respondent under section 148 of the Act, and all proceedings taken pursuant thereto, are hereby quashed and set aside. Rule is made absolute accordingly. No order as to costs. X X X X Extracts X X X X X X X X Extracts X X X X
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