TMI Blog2023 (2) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... peal is directed against the order dated 06.07.2018 passed by the Income Tax Appellate Tribunal [in short Tribunal ] concerning Assessment Year (AY) 2010-2011. 2. This appeal has a chequered history, inasmuch as it has been placed before us, on account of a difference of opinion in the coordinate bench which was constituted at the relevant point in time. It is evident from a perusal of the order dated 18.05.2021, passed by a bench comprising Hon ble Mr Justice Rajiv Sahai Endlaw [as he then was] and Hon ble Mr Justice Sanjeev Narula, that two issues were being considered when the said order was passed: (i) First, as to whether the Tribunal had rightly entertained the additional ground raised before it? The additional ground concerned the jurisdiction of the AO in having the assessment order framed against a company, which was not in existence. (ii) Second, whether this was a case, in which a substantial question of law arose, having regard to the judgment rendered by the Supreme Court in Principal Commissioner of Income Tax, New Delhi vs. Maruti Suzuki India Ltd. (2019) 416 ITR 613 (SC). 2.1 Insofar as the first issue is concerned, both learned judges were of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... insofar as the erstwhile company was concerned. 7. The record also shows (and this is something concerning which there is no dispute), that the AO referred the matter to the Transfer Pricing Officer (TPO) with regard to the determination of Arm s Length Price (ALP) involving the international transaction said to have been undertaken by the respondent/assessee. The TPO opined, that an upward adjustment amounting to Rs.56,30,78,638/- would have to be made. Accordingly, a draft assessment order was framed by the AO on 31.03.2014. 8. Qua this, respondent/assessee preferred its objections with the Dispute Resolution Panel (DRP). The DRP dismissed the objections on 21.10.2014. It is pursuant to the dismissal of the respondent/assessee s objection, that the AO framed the assessment order dated 22.12.2014 under Section 143(3) read with Section 144C of the Act. 9. As noticed hereinabove, the respondent/assessee raised an additional ground before the Tribunal, concerning the absence of jurisdiction with regard to the framing of the order by the AO under Section 143(3) of the Act. 10. In particular, the ground articulated by the respondent/assessee was, that the assessment order h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Principal Commissioner of Income Tax (Central) - 2 vs. Mahagun Realtors (P) Ltd 2022 SCC OnLine SC 407. 13.2 Based on the said judgment, Mr Kumar s contention is, that upon amalgamation, the amalgamating company dissolves, and therefore, the liability to tax can be determined in the given facts and circumstances of the case, by perusing the amalgamated company. 13.3 It is in this context, that Mr Kumar has also relied upon the order sanctioning the amalgamation scheme i.e., order dated 23.07.2013. 14. Our attention has been drawn to the fact, that both in terms of the order sanctioning the amalgamation scheme as well as the amalgamation scheme itself, the respondent/assessee i.e., the amalgamated company was obliged to take over not only the liabilities of the erstwhile company, but also bear the burden of the proceedings which had been commenced against the erstwhile company being the transferee company. 15. On the other hand, Mr Nageshwar Rao, who appears on behalf of the respondent/assessee, as would be expected, has relied upon the ratio of the judgment in Maruti Suzuki. Mr Rao has also taken us through certain paragraphs of the judgment rendered by the Supreme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed judgements: 21. In Spice Entertainment [Spice Entertainment Ltd. v. Commr. of Service Tax, 2011 SCC OnLine Del 3210 : (2012) 280 ELT 43] , a Division Bench of the Delhi High Court dealt with the question as to whether an assessment in the name of a company which has been amalgamated and has been dissolved is null and void or, whether the framing of an assessment in the name of such company is merely a procedural defect which can be cured. The High Court held that upon a notice under Section 143(2) being addressed, the amalgamated company had brought the fact of the amalgamation to the notice of the assessing officer. Despite this, the assessing officer did not substitute the name of the amalgamated company and proceeded to make an assessment in the name of a non-existent company which renders it void. This, in the view of the High Court, was not merely a procedural defect. Moreover, the participation by the amalgamated company would have no effect since there could be no estoppel against law : (SCC OnLine Del paras 11-12) 11. After the sanction of the scheme on 11-4-2004, Spice ceases to exit w.e.f. 1-7-2003. Even if Spice had filed the returns, it became incumbent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rit in the appeals and special leave petitions. Accordingly, the appeals and special leave petitions are dismissed. 28. 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 [Skylight Hospitality LLP v. CIT, 2018 SCC OnLine Del 7155 : (2018) 405 ITR 296] which was affirmed on 6-4-2018 [Skylight Hospitality LLP v. CIT, (2018) 13 SCC 147] by a two-Judge Bench of this Court consisting of Hon'ble Mr Justice A.K. Sikri and Hon'ble Mr Justice Ashok Bhushan. In assessing the merits of the above submission, it is necessary to extract the order dated 6-4-2018 [Skylight Hospitality LLP v. CIT, (2018) 13 SCC 147] of this Court : (Skylight Hospitality case [Skylight Hospitality LLP v. CIT, (2018) 13 SCC 147] , SCC p. 147, para 1) 1. In the peculiar facts of this case, we are convinced that wrong name given in the notice was merely a clerical error which could be corrected under Section 292-B of the Income Tax Act. The special leave petition is dismissed. Pending applications stand disposed of. Now, it is evident from the above extract that it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. 29. The decision in Spice Entertainment [ Spice Entertainment Ltd. v. Commr. of Service Tax, 2011 SCC OnLine Del 3210 : (2012) 280 ELT 43] was distinguished with the following observations : ( Skylight Hospitality case [Skylight Hospitality LLP v. CIT, 2018 SCC OnLine Del 7155 : (2018) 405 ITR 296] , SCC OnLine Del para 19) 19. Petitioner relies on Spice Infotainment v. CIT [ This judgment has also been referred to as Spice Infotainment Ltd. v. CIT, (2012) 247 CTR (Del) 500]. Spice Corp. Ltd., the company that had filed the return, had amalgamated with another company. After notice under Sections 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was held that in every case of transfer, devolution, merger or scheme of amalgamation, in which rights and liabilities of one company are transferred or devolved upon another company, the successor-in-interest becomes entitled to the liabilities and assets of the transferor company subject to the terms and conditions of contract of transfer or merger, as it were. Later, in Singer India Ltd. v. Chander Mohan Chadha this court held as follows: 8. ..there can be no doubt that when two companies amalgamate and merge into one, the transferor company loses its identity as it ceases to have its business. However, their respective rights and liabilities are determined under the scheme of amalgamation, but the corporate identity of transferor company ceases to exist with effect from the date the amalgamation is made effective. 33 . In Maruti Suzuki (supra), the scheme of amalgamation was approved on 29.01.2013 w.e.f. 01.04.2012, the same was intimated to the AO on 02.04.2013, and the notice under Section 143(2) for AY 2012-2013 was issued to amalgamating company on 26.09.2013. This court in facts and circumstances observed the following: 35. In this case, the notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act were not brought to the notice of this court, in the previous decisions. 35. There is no doubt that MRPL amalgamated with MIPL and ceased to exist thereafter; this is an established fact and not in contention. The respondent has relied upon Spice and Maruti Suzuki (supra) to contend that the notice issued in the name of the amalgamating company is void and illegal. The facts of present case, however, can be distinguished from the facts in Spice and Maruti Suzuki on the following bases. 36. Firstly, in both the relied upon cases, the assessee had duly informed the authorities about the merger of companies and yet the assessment order was passed in the name of amalgamating/non-existent company. However, in the present case, for AY 2006-2007, there was no intimation by the assessee regarding amalgamation of the company. The ROI for the AY 2006-2007 first filed by the respondent on 30.06.2006 was in the name of MRPL. MRPL amalgamated with MIPL on 11.05.2007, w.e.f. 01.04.2006. In the present case, the proceedings against MRPL started in 27.08.2008- when search and seizure was first conducted on the Mahagun group of companies. Notices under Section 153A and Secti ..... 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