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TMI Blog2022 (1) TMI 1317X X X X Extracts X X X X X X X X Extracts X X X X ..... ection143(3) r.w.s. 144C(13) of the Income-tax Act, 1961 ("the Act‟)("Assessment order‟), in pursuance to the Directions issued by Dispute Resolution Panel-1 ("Hon‟ble DRP‟), Mumbai, on the following grounds: General Ground 1. Erred in assessing the total income of the Appellant at Rs 1424,94,70,020 against a total income of Rs 1337,19,10,332 as computed by the Appellant in its revised computation of income. A. Transfer Pricing Grounds Reference made to the Transfer Pricing Officer (' TPO') 2. Erred in making a reference of the Appellant's case to the Learned TPO under Section 92CA( I) of the Act, without satisfying the conditions specified therein. Disallowance of royalty payment 3. Erred in determining the arm's length value of the royalty paid by the Appellant for AY 2012-13 and AY 2013-14 to be Nil disregarding the benefits accrued to the Appellant by accessing Accenture's portfolio of intellectual property. Quantum of TP adjustment to be restricted to value of international transaction 4. Erred in making an adjustment of Rs 87,75,59,686 in respect of the international transaction of payment of royalty disregar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... declaring total income of Rs. 1338,62,60,790/-. The return of income was taken up for scrutiny. During the course of assessment proceedings, assessee filed a revised return of total income showing total income of Rs. 1337,19,10,332/-. 03 Before ld AO, during the course of assessment proceedings, assessee submitted a letter dated 14/12/2016 stating that Hon‟ble Bombay High Court has passed an order dated 20/10/2016 sanctioning the scheme of amalgamation of Accenture Services Pvt Ltd with Accenture Solutions Pvt Ltd. The appointed date of the scheme was 01/04/2015, which has become operative from 01/12/2016. The assessee also specifically requested the Assessing Officer to issue all communication / order of "Accenture Services Pvt Ltd" in the name of "Accenture Solutions Pvt Ltd.‟ 04 The learned Assessing Officer noted that assessee has entered into certain international transactions and, therefore, the matter was referred under section 92CA of the Act to the Transfer Pricing Officer to determine Arm‟s length price of international Transactions. The learned TPO passed an order under section 92CA (3) proposing an adjustment of Rs. 1211,03,34,497/- to the total ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 017 passed under Section 143(3) / 144C(13) of the Act is bad in law and liable to be quashed as the assessment order was framed on a non-existing entity as on the date of such order (the said company having merged with Accenture Solutions Private Limited w.e.f. 01 December 2016)." 11 The learned authorized representative commenced his arguments stating that on the jurisdictional issue, he would like to press ground 17 first. For the admission of the above ground, he relied upon the decision of Hon‟ble Supreme Court in case of National Thermal Power Co. Ltd vs CIT 229 ITR 383(SC); Jute Corporation of India 187 ITR 688 (SC) and the decision of the Hon‟ble Bombay High Court in case of Ahmadabad Electricity Co. Ltd 199 ITR 351 (Bom). He further stated that the additional grounds of appeal raised by the assessee goes to the root of the matter, is a jurisdictional issue and no further facts are required to be investigated; therefore, additional grounds may be admitted. 12 The learned CIT (DR) vehemently objected and submitted that such ground was not taken before the ld. DRP and assessee has participated in the assessment proceedings, and therefore, the same should not be a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tent entity is a nullity and therefore, the same is required to be quashed. He further held that such an order passed is without any jurisdiction and deserves to be set aside. For this proposition, he relied upon the decision of the Hon‟ble Supreme Court in case of PCIT vs Maruti Suzuki India Ltd 416 ITR 613 (SC) dated 25/07/2019. He further referred to the decision of Hon‟ble Supreme Court in Civil Appeal No. 285 of 2014 in CIT vs Spice Infotainment Ltd dated 02nd November 2017 wherein the appeals by the revenue against the decision of the Hon‟ble Delhi High Court in ITA No. 475 of 2011 dated 03rd August 2011 were dismissed. He further referred to several decisions of the co-ordinate benches and stated that the assessment order passed by the learned AO on the non-existing entity deserves to be quashed. 16 Countering the submission of the learned counsel, the Ld. CIT (DR) vehemently submitted that the assessee company has merged into another company. He further submitted that the assessee has been issued the notices under section 143(2) correctly and assessee appeared before the assessing officer. It was further stated that assessee is not at all aggrieved by mer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was given to the assessing officer on 14/12/2016. Assessee has also placed the duly acknowledged letter submitted to the assessing officer. The above fact has also been recorded by the learned assessing officer in his draft assessment order passed on 15/12/2016. The assessing officer, even after that, passed draft Assessment order in the name of "Accenture Services Pvt Ltd (Now Merged with and Known as "Accenture Solutions Pvt Ltd"). The learned DRP has correctly mentioned the name of resultant entity in its direction dated 22/09/2017. However, the learned assessing officer, despite the above facts, once again recording the same facts in his assessment order passed final assessment order in the name of "Accenture Services Pvt Ltd ( now merged with and Known as Accenture Solutions Pvt Ltd)" and not in the name of resultant entity i.e. "Accenture Solutions Pvt Ltd‟. Thus, it is clear that as on the date of passing of assessment order, i.e. on 28/11/2017, "Accenture Services Pvt Ltd‟ was not at all in existence as it got merged with "Accenture Solutions Pvt Ltd.‟ Such an assessment order passed on nonexistent company is invalid. 19 The Hon‟ble Supreme Court, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... splacement of settled expectations. There is a significant value which must attach to observing the requirement of consistency and certainty. Individual affairs are conducted and business decisions are made in the expectation of consistency, uniformity and certainty. To detract from those principles is neither expedient nor desirable." 20 Now we come to the order of the Hon‟ble Delhi High Court in case of PCIT vs Sony Ericsson Mobile Communications India Pvt Ltd in ITA No. 115 of 2019 reported in TS-367-HC-2021 dated 18/05/2021. Indeed, there is a difference of opinion between the Hon‟ble Judges. However, at the end, in the last paragraph, the Hon‟ble High Court has held that the question of law was to be framed and appeal is required to be admitted. Further the facts in those were quiet different as held in para no 16 as under :- "16. We also do not have before us, the communications dated 6th December, 2013 and 17th February, 2014 by which the Respondent-Assessee is stated to have informed the AO of the change of name and are thus unable to gauge whether they were in relation to proceedings for assessment of the relevant year or in general." In the present ..... X X X X Extracts X X X X X X X X Extracts X X X X
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