TMI Blog2020 (8) TMI 599X X X X Extracts X X X X X X X X Extracts X X X X ..... amalgamated company, nor the same be validated by bringing it within the realm of a procedural irregularity within the meaning of Sec. 292B. A strong conviction that non-issuance of a notice u/s 143(2) to the amalgamated company, which forms the very foundation for framing of a valid assessment would divest the A.O of his very jurisdiction to frame such assessment. We would mince no words in concluding that the non-issuance of a notice u/s 143(2) to the amalgamated company viz. M/s Siemens Limited, PAN No. AAACS0764L, would therein render the impugned assessment framed by the A.O u/s 143(3) r.w.s 144C(13), dated 30.01.2017 as invalid and void ab initio. Accordingly, the impugned assessment framed by the A.O de hors issuance of any notice u/s 143(2) to the amalgamated company cannot be sustained, and is thus quashed for want of jurisdiction. The additional ground of appeal raised by the assessee is allowed. - ITA No 2181/Mum/2017 - - - Dated:- 20-8-2020 - Shri M. Balaganesh, Accountant Member And Shri Ravish Sood, Judicial Member For the Appellant : Shri N itesh Joshi , A.R For the Respondent : Shri Uodhal Raj Singh , D.R ORDER PER RAVISH SOOD, JM T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gain / loss as non-operating item in the Appellant's own case for AY.2010-11 and AY 2011-12. 7. On the facts and in the circumstances of the case and in law, the Hon'ble DRP erred in rejecting the without prejudice contention of the Appellant that its profitability for the 6 months period ended 30 September 2011 has been severely impacted vis- -vis full financial year, i.e. 1 April 2011 to 31 March 2012 and hence, no adjustment should be made to the international transactions entered into by the Appellant. 8. On the facts and in the circumstances of the case and in law, the learned AO erred in passing the impugned order under the Permanent Account Number of Siemens Power Engineering Private Limited which has ceased to exist on the date of the impugned order on account of its merger with Siemens Limited with effect from 1 October 2011, thereby the entire assessment proceedings be regarded to be void ab initio as the same has been passed in the case of nonexistent entity. 9. On the facts and in the circumstances of the case and in law, the learned AO / TPO erred and the Hon'ble DRP further erred in upholding / confirming the action of the learned AO / TPO in in n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y powers which the subordinate authority may have in the matter. Also, support was drawn by the ld. A.R from the judgment of the Hon ble Apex Court in the case of National Thermal Power Co. Ltd. Vs. CIT (1998) 229 ITR 383 (SC). Relying on the said judgment, it was submitted by the ld. A.R that as held by the Hon ble Apex Court the Tribunal has jurisdiction to examine a question of law which arises from the facts as found by the authorities below and have a bearing on the tax liability of the assessee, notwithstanding the fact that same was not raised before the lower authorities. In the backdrop of his aforesaid contentions, it was submitted by the ld. A.R that as the adjudication of the aforesaid legal issue was based on the facts available on record and no further investigation on facts was required, therefore, the same may be admitted. It was further submitted by the ld. A.R that in case the additional ground of appeal was decided in favour of the assessee, then the other grounds of appeal would be rendered as merely academic in nature. Per contra, the ld. Departmental representative (for short D.R ) strongly objected to the admission of the additional ground of appeal as was s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection of the revenue that now when the assessee had participated in the assessment proceedings, it could thereafter not be permitted to assail the validity of the assessment on a technical issue, and that too after a substantial lapse of time, we are afraid the same does not find favour with us. We find that the Hon ble Apex Court in the case of PCIT Vs. Maruti Suzuki India Ltd. (2019) 416 ITR 613 (SC), had observed, that now when the very basis on which jurisdiction was invoked was fundamentally at odds with the legal principle that the amalgamating entity had ceased to exist upon the approved scheme of amalgamation, the participation in the proceedings by the appellant in the circumstances cannot operate as an estoppel against law. Accordingly, in the backdrop of the aforesaid facts, we find no reason as to why the additional ground of appeal raised by the assessee, therein seeking adjudication of a legal issue based on the facts borne from the records may not be admitted. We thus not being persuaded to accept the objection raised by the ld. D.R as regards admission of the aforesaid additional ground of appeal raised by the assessee, admit the same. 3. Briefly stated, the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O, we shall thus first deal with the same. The ld. Authorised representative (for short A.R ) for the assessee submitted that the A.O vide a letter dated 04.05.2013 was intimated of the fact that the assessee viz. M/s Siemens Power Engineering Pvt. Ltd, PAN No. AACCS5323F pursuant to the orders of the High Court of Punjab Haryana dated 23.11.2012, and that of the High Court of Bombay dated 02.11.2012, issued under Sec. 391 to Sec. 394 of the Companies Act, 1956, was amalgamated with M/s Siemens Limited, PAN No. AAACS0764L, Registered office: 130, Pandurang Budhkar Marg, Worli, Mumbai, with appointed date as 01.10.2011. In order to support his aforesaid contention the ld. A.R took us through a letter dated 14.05.2013 that was addressed by the assessee to the A.O. Further, the ld. A.R took us through a letter dated 14.05.2013, wherein the aforesaid fact as regards amalgamation of the assessee company was also brought to the notice of the Commissioner of Income-tax, Gurgaon, with a request that the case of the assessee may be transferred to the Commissioner of Income-tax, Range 7, Mumbai, who was vested with the requisite jurisdiction in the case of the amalgamated company i.e M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amating entity ceases to exist upon the approved scheme of amalgamation, therefore, the participation in the proceedings by the assessee under such circumstances cannot operate as an estoppel against law. Further, the ld. A.R relied on the order passed by the Tribunal in the assessee s own case for A.Y 2010-11 in ITA No. 1772/Mum/2015m, dated 15.10.2019 (copy placed on record). On the basis of his aforesaid contentions, it was submitted by the ld. A.R that as the A.O had assumed jurisdiction san issuance of a valid notice u/s 143(2) to the amalgamated company, the assessment therein framed could not be sustained and was thus liable to be vacated. 6. Per contra, the ld. Departmental representative (for short D.R ) relied on the orders of the lower authorities. It was submitted by the ld. D.R that as both the draft assessment order, as well as the final assessment order was passed in the name of the amalgamated company viz. M/s Siemens Limited, therefore, no infirmity did therein emerge. Further, it was submitted by the ld. D.R that the assessee had neither intimated about the amalgamation of the assessee company, nor raised the aforesaid issue before the first appellate authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 was issued, but then, the latter notice is also found to have been issued in the name of the amalgamating company viz. M/s Siemens Power Engineering Pvt. Ltd, PAN No. AACCS5323F. In sum and substance, it is a matter of fact borne from the records that no Notice u/s 143(2) was ever issued by the A.O to the amalgamated company viz. M/s Siemens Limited. 8. Although, it is a matter of fact borne from the records that both the draft assessment order u/s 143(3) r.w.s 144C(1), dated 28.03.2015, and the final assessment order u/s 143(3) r.w.s 144C(13), dated 30.01.2017 have been passed in the name of M/s Siemens Ltd. (successor in interest to Siemens Power Engineering Pvt. Ltd.) , but then, the PAN No. in both the respective orders is that of the amalgamating company viz. M/s Siemens Power Engineering Pvt. Ltd. Be that as it may, our indulgence in the present appeal has been sought by the assessee, to adjudicate, the validity of the assessment order passed u/s 143(3) r.w.s 144C(13) de hors issuance of any notice u/s 143(2) to the amalgamated company. Viewed from another angle, we have been called upon to adjudicate the validity of the assessment framed without issuance of any notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ddressed to the Commissioner of Income-tax, Gurgaon, had brought the aforesaid fact of its amalgamation with M/s Siemens Limited, PAN No. AAACS0764L to his notice, with a request that its case may be transferred to the Commissioner of Income-tax, Range-7, Mumbai, who exercised the requisite jurisdiction over the case of the amalgamated company i.e M/s Siemens Limited. We find that the Hon ble Supreme Court in the case of Saraswati Industrial Syndicate Ltd. Vs. CIT, 186 ITR 278, had observed, that it is trite law that on amalgamation, the amalgamating company ceases to exist in the eyes of law. The Hon ble Supreme Court while concluding as hereinabove had observed as under: The question is whether on the amalgamation of the India Sugar Company with the appellant Company, the Indian Sugar Company continued to have its entity and was alive for the purposes of Section 41(1) of the Act. The amalgamation of the two companies was effected under the order of the High Court in proceedings under Section 391 read with Section 394 of the Companies Act. The Saraswati Industrial Syndicate. the trans free Company was a subsidiary of the Indian Sugar Company, namely, the transferor Company. Un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be cured by invoking the provisions of Sec. 292B of the Act. Further, the Hon ble Supreme Court in the case of Pr. CIT Vs. Maruti Suzuki India Ltd. (2019) 416 ITR 613 (SC), had observed, that where the A.O despite being informed of the fact that the amalgamating company had ceased to exist as a result of the approved scheme of amalgamation, had issued the notice u/s 143(2) in the name of the amalgamating company, the very basis on which jurisdiction was invoked was fundamentally at odds with the legal principle that the amalgamating entity ceased to exist upon the approved scheme of amalgamation. Further, it was observed by the Hon ble Apex Court, that participation in the proceedings by the assessee cannot operate as an estoppel against law. On the basis of our aforesaid observations, we are of the considered view that neither the issuance of the notice u/s 143(2) to the amalgamating company i.e a non-existent entity be construed as a notice issued to the amalgamated company, nor the same be validated by bringing it within the realm of a procedural irregularity within the meaning of Sec. 292B of the Act. We are of a strong conviction that non-issuance of a notice u/s 143(2) to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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