TMI Blog2023 (3) TMI 525X X X X Extracts X X X X X X X X Extracts X X X X ..... rder under section 148A(d) of the Act and subsequent notice under section 148 of the Act, yet, in our opinion, the same would not preclude the petitioner from challenging the validity of the notice under section 148 on the aforementioned ground, keeping in view the ratio of the judgment in the case of Maruti Suzuki India Ltd. [ 2019 (7) TMI 1449 - SUPREME COURT] that participation in the proceedings would not operate as an estoppel against law, based upon the settled legal principle that the amalgamating entity had ceased to exist upon the scheme of amalgamation being approved. The petition is allowed. The impugned notice under section 148 AND the impugned order under section 148A(d) and all proceedings connected thereto are hereby quas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al of the competent authority. A copy of the approval is also on record which reflects that the same was accorded for issuance of notice under section 148 of the Act against M/s. Pinkhem Investment Co. Pvt. Ltd. Finally, a notice under section 148 dated 31st July 2022 was issued against M/s. Pinkhem Investment Co. Pvt. Ltd.. 3. Counsel for the petitioner states that the impugned notice is unsustainable inasmuch as M/s. Pinkhem Investment Co. Pvt. Ltd. had already amalgamated with Veer Mercantile Private Limited (which name was subsequently changed to Pico Capital Private Limited, i.e., the petitioner herein) with effect from 1st April 2015 pursuant to a scheme of amalgamation which was approved by this Court vide order, dated 22nd July 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... This is clearly untenable in view of the Apex Court judgment in Saraswati Industrial Syndicate Ltd. v/s. CIT 186 ITR 278 (SC)., wherein the following principles were formulated: 5. Generally, where only one company is involved in change and the rights of the shareholders and creditors are varied, it amounts to reconstruction or reorganisation or scheme of arrangement. In amalgamation two or more companies are fused into one by merger or by taking over by another. Reconstruction or 'amalgamation' has no precise legal meaning. The amalgamation is a blending of two or more existing undertakings into one undertaking, the shareholders of each blending company become substantially the shareholders in the company which is to carr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nciples and held as under: 33. In the present case, despite the fact that the assessing officer was informed of the amalgamating company having ceased to exist as a result of the approved scheme of amalgamation, the jurisdictional notice was issued only in its name. The basis on which jurisdiction was invoked was fundamentally at odds with the legal principle that the amalgamating entity ceases to exist upon the approved scheme of amalgamation. Participation in the proceedings by the appellant in the circumstances cannot operate as an estoppel against law. This position now holds the field in view of the judgment of a co-ordinate Bench of two learned judges which dismissed the appeal of the Revenue in Spice Entertainment on 2 November ..... X X X X Extracts X X X X X X X X Extracts X X X X
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