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TMI Blog2023 (9) TMI 1151X X X X Extracts X X X X X X X X Extracts X X X X ..... 16,173/- (Tax effect Rs. 1,14,22,727/-) a. The learned AO, learned Transfer Pricing Officer ("learned TPO") and the Honourable Dispute Resolution Panel ("Hon'ble DRP") have grossly erred in law and facts of the case by proposing a transfer pricing adjustment of INR 3,42,16,173/-under section 92CA of the Income-tax Act, 1961("the Act") with respect to the international transactions. b. On the facts and in the circumstances of the case and in law, the learned AO / TPO erred in disregarding the fact that none of the conditions set out in Section 92C(3) of the Act are satisfied. The Assessee has complied with the provisions of Section 92C(1) and 92C(2) of the Act and the learned AO/ TPO has erred in disregarding the transfer pricing analysis carried out by the Assessee. c. On the facts and in the circumstances of the case and in law, the learned AO/TPO rejected the economic analysis undertaken by the Assessee without providing any cogent reasons for rejection of the comparable companies arrived at by the Assessee in its Transfer Pricing study report. * Tata Consulting Engineers Ltd. * Satyam Venture Engineering Services Private Ltd; and * Krikamit Engineering Pvt Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. [tax effect Rs. 10,85,182 /-] 6. Duty drawback amounting to INR 1,45,81,900/- (Tax effect Rs. 48,68,021/-) a. On the facts and in the circumstances of the case, the learned AO erred in adding duty drawback amounting to INR 1,45,81,900 as per the records of income-tax department without seeking any explanation / justification from the assessee. b. Without prejudice to the above, the learned AO erred in not appreciating the fact that out of the total duty drawback amounting to INR 1,45,81,900 appearing as per records of income-tax department, an amount of INR 1,30,90,550 appearing in the Profit & Loss account of the assessee had already been offered to tax which has resulted in double taxation of duty drawback to the extent of Rs. 130,90,550. The learned AO erred in not applying the principle of consistency by adding the amount of duty drawback only in the year under consideration. 7. On the facts and in the circumstances of the case, the learned AO erred in ignoring the submissions made by the assessee and disallowing 30% of Rs. 3,42,65,580 under section 40(a)(ia) of the Act despite the fact that tax was already deducted and paid on the said amount. 8. The learned AO er ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aft order has been passed in the name of M/s SKF Technologies India Private Limited bearing PAN number AAACC4393D. The said entity is non-existent pursuant to the merger which has taken effect from 1st April 2018. The Learned AO, while passing the draft order, was aware of this fact which is apparent from the impugned order wherein the AO has noted this fact. 1.2. The Assessee has intimated the Learned AO on multiple occasions (a reference may be made to Annexure 2 for general intimation and Annexure 4 for specific intimation during the course of assessment proceedings) wherein it has brought to the knowledge of the Learned AO that M/s SKF Technologies India Private Limited is merged with M/s. Lincoln Helios (India) Limited which is now called SKF Engineering and Lubrication India Pvt Ltd. 1.3. From the above it can be inferred that the learned AO was duly intimated and was privy to the information of the non-existent status of the Assessee, thereby rendering the assessment order passed on such entity is void ab initio. 1.4. We wish to place reliance on the ruling of the Hon'ble Supreme Court in the case of PCIT vs Maruti Suzuki India Ltd [2019] 416 ITR 613 (SC)[25-07-201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . - Trib.)/ ITA NO. 857/MUM/2016, wherein it was held that where draft assessment order under section 144C was passed in name of amalgamating company, which was a non-existent entity in eyes of law on the date of passing of such order, it became an illegal order and, thus, entire assessment proceedings based on such an invalid draft assessment order is void ab initio and deserve to be quashed. Additional reliance is placed on the following rulings: − Honda Cars India Ltd. Vs. DCIT ITA No.629 /De1/2021 Assessment Year: 2016-17 − Siemens Ltd. Vs. DCIT [2023] 147 taxmann.com 118 (Mumbai - Trib.)[12-12-2022] − BOEING India (P.) Ltd. v. Asstt. CIT [2020] 121 taxmann.com 276 (Delhi - Trib.) 1.9. The limitation period for the conclusion of TP and Non-TP cases concluded on 30.09.2021 after considering various relaxations/extensions on account of COVID. The Learned AO should have passed assessment order u/s 143(3) on/before 30.09.2021 as provisions of section 144C are not applicable. Given the above, subsequent legislation (170(2A) applicable from 1.4.2022) cannot be invoked to revive proceedings that had attained finality on 30.09.2021. 1.10. Section 170(2A) has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vices (P.) Ltd. v. DCIT, 92 taxmann.com 445 (bengaluru - trib.) 6. After hearing both the sides, perusing the entire material on record and the orders of the lower authorities, we note that SKF Technologies India Private Ltd. [STIPL] merged into M/s. Lincoln Helios (India) Limited after passing of the order by NCLT dated 14.2.2020 w.e.f. 1.4.2018 and now known as SKF Engineering and Lubrication India Pvt. Ltd. [SELIPL]. Thereafter the assessee informed the revenue authorities about the amalgamation on 05.06.2020, 03.12.2020, 28.12.2020, 12.07.2021, 29.07.2021, 30.08.2021,13.09.2021 & 29.09.2021 . On perusal of the details on record, we note that the various notices are issued by all the revenue authorities viz., AO/TPO/DRP in the name of STIPL the replies are submitted by the assessee in the name of new company SELIPL on different dates. The AO in the draft assessment order has mentioned in his order as under:- "The assessee company M/s. SKF Technologies India Pvt. Ltd. merged into M/s. Lincoln Helios (India) Limited w.e.f. 01-04- 2018 and now known as M/s. SKF Engineering and Lubrication India Pvt. Ltd. filed its return of income for AY 2018-19 on 29- 11-2018, declaring current ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... malgamation either by the transfer of two or more undertakings to a new company, or by the transfer of one or more undertakings to an existing company. Strictly 'amalgamation' does not cover the mere acquisition by a company of the share capital of other company which remains in existence and continues its undertaking but the context in which the term is used may show that it is intended to include such an acquisition. See: Halsbury's Laws of England (4th edition volume 7 para 1539). Two companies may join to form a new company, but there may be absorption or blending of one by the other, both amount to amalgamation. When two companies are merged and are so joined, as to form a third company or one is absorbed into one or blended with another, the amalgamating company loses its entity." In the case of Spice Entertainment Ltd. v. CST 2012 (280) ELT 43 (Delhi) a Division Bench of the Delhi High Court held that once the factum of amalgamation of a company had been brought to the notice of the A.O., despite which the proceedings are continued and an order of assessment passed in the name of non-existence company, the order of assessment would not be merely be a procedural ..... X X X X Extracts X X X X X X X X Extracts X X X X
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