TMI Blog2022 (12) TMI 524X X X X Extracts X X X X X X X X Extracts X X X X ..... d various issues on the transfer pricing adjustment made in respect of the international transactions between assessee and its AE. 3. However, in ground no. 2, assessee challenges the validity of impugned order as it is passed on a non-existing entity i.e. erstwhile Marlabs Software Pvt. Ltd. The relevant grounds reads as under: 2. That on facts and circumstances of the case, the LAO has erred in passing the order on a non-existing entity i.e. erstwhile Marlabs Software Private Limited. 4. The Ld.AR relied on decision of Hon ble Supreme Court in case of PCIT vs. Maruti Suzuki India Ltd. reported in (2019) 107 taxmann.com 375 wherein the Hon ble Supreme Court has held that an income that was sought to be subjected to the charge of tax for the year was the income of the erstwhile entity prior to amalgamation. Under an approved scheme of amalgamation Hon ble Supreme Court held that the transferee has assumed the liabilities of the transferor company, including tax liabilities. The consequence of the scheme of amalgamation approved u/s. 394 of the Companies Act, 1956 was that the amalgamating company ceased to exist. Hon ble Supreme Court has held that upon the amalgamatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hart will explain the facts of the Assessee s case and the facts of the case decided by the Hon ble Supreme Court in the case of M/s.Maruti Suzuki India Limited (supra): Facts in the case of Maruti Suzuki India Ltd. Facts in the case of Assessee Suzuki Powertrain India Limited (SPIL or amalgamating company) had amalgamated with Maruti Suzuki India Limited (MSIL or amalgamated company) by a scheme of amalgamation approved by the High Court (HC) on January 29, 2013, with effect from fiscal year commencing on April 1, 2012. The scheme provided that all the assets, liabilities and duties of the amalgamating company be transferred to the MSIL and that the SPIL would stand dissolved without winding up. On April 2, 2013 - the Assessee informed the AO that SPIL has amalgamated with MSIL. On September 26, 2013 , the AO issued notice u/s.143(2) for AY 2011-12. On September 4, 2015, the AO issued letters to the Assessee with the following description:- The Principal Officer M/s Suzuki Powertrain India Limited (Now known as M/s Maruti Suzuki India Limited) On March 11, 2016, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d and thereby the initiation of assessment proceedings was void ab initio. The fact that the amalgamated company participated in the assessment proceedings would not operate as estoppel. 11. The facts of the Assessee s case is identical to the facts of the case decided by the Hon ble Supreme Court in the case of M/s.Maruti Suzuki India Ltd.(supra). Since the assessee company ceased to be in existence as on the date when the AO passed the order of assessment, assessment so framed is not sustainable in the eyes of law, being a nullity. The Hon ble Supreme Court in the case of M/s.Maruti Suzuki India Ltd. (supra), also dealt with the decision of the Hon'ble Delhi High Court in case of Sky Light Hospitality LLP vs. ACIT reported in (2018) 405 ITR 296 observed as under: 27. The submission however which has been urged on behalf of the Revenue is that a contrary position emerges from the decision of the Delhi High Court in Skylight Hospitality LLP which was affirmed on 6 April 2018 by a two judge Bench of this Court consisting of Hon'ble Mr Justice A K Sikri and Hon'ble Mr Justice Ashok Bhushan33. In assessing the merits of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made in addressing the notice. Noticeably, the appellant having received the said notice, had filed without prejudice reply/letter dated 11.04.2017. They had objected to the notice being issued in the name of the Company, which had ceased to exist. However, the reading of the said letter indicates that they had understood and were aware, that the notice was for them. It was replied and dealt with by them. The fact that notice was addressed to M/s. Skylight Hospitality Pvt. Ltd., a company which had been dissolved, was an error and technical lapse on the part of the respondent. No prejudice was caused. 28. The decision in Spice Entertainment was distinguished with the following observations: 19. Petitioner relies on Spice Infotainment Ltd. v. Commissioner of Service Tax, (2012) 247 CTR 500.Spice Corp. Ltd., the company that had filed the return, had amalgamated with another company. After notice under Section 147/148 of the Act was issued and received in the name of Spice Corp. Ltd., the Assessing Officer was informed about amalgamation but the Assessment Order was passed in the name of the amalgamated company and not in the name of amalgamating company. In the said s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccessor entity. 33. Hence, while dismissing the Special Leave Petition this Court observed that it was the peculiar facts of the case which led the court to accept the finding that the wrong name given in the notice was merely a technical error which could be corrected under Section 292B. Thus, there is no conflict between the decisions in Spice Enfotainment on the one hand and Skylight Hospitality LLP on the other hand. 12. Respectfully following the decision of Hon ble Supreme Court in case of PCIT vs. Maruti Suzuki India Ltd.(supra), we hold that, since the assessee ceased to be in existence as on the date when the Ld.AO passed the impugned order of assessment, the assessment so framed is not sustainable in the eye of law. The final order of assessment is therefore liable to be annulled, and is hereby annulled. Accordingly, the assessee s appeal stands allowed on the legal issue raised in ground no. 2. 13. As we have decided the legal issue in favour of assessee, the issues alleged by assessee on merits is left open for academic purposes. In the result, the appeal filed by the assessee stands allowed. Order pronounced in open court on 13th July, 2022. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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