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TMI Blog2025 (5) TMI 546X X X X Extracts X X X X X X X X Extracts X X X X ..... oner. The relevant portion is extracted here under: "SHOW CAUSE NOTICE No. 06/2020 (C) ..... 5. Shri Shantanu Majumder, Senior DGM (Finance and Accounts) of M/s. L&T Ship building Limited, in his statement dated 02/09/2020, interalia stated the following: M/s. L&T Shipbuilding Limited is an SEX unit in the SEZ notified area. Their operations are monitored by the Customs authorities under SEZ Act. It was a 100% subsidiary of L&T Limited, now as on date it has been merged with L&T Limited.." 3. It is further submitted by the learned counsel for the petitioner that the issue stands covered by this Court in the case of M/s. Pharmazell (India) Private Limited in W.P.No.22468 of 2021 dated 27.02.2024, wherein reference was made to the judgment of the Supreme Court in Maruti Suzuki and Spice Entertainment amongst others. The relevant portion of the order of this Court is extracted hereunder: "4. It was submitted that pursuant to the order of amalgamation any order that is made in the name of Pharmazell Vizag which is not in existence would be void, reliance was placed on the judgment of the Hon-ble Supreme Court in case of Maruti Suzuki and the Delhi High Court in the case of Sp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be treated as procedural defect. Mere participation by the appellant would be of no effect as there is no estoppel against law. 12. Once it is found that assessment is framed in the name of non-existing entity, it does not remain a procedural irregularity of the nature which could be cured by invoking the provisions of Section 2928 of the Act." Following the decision in Spice Entertainment, (supra) the Delhi High Court quashed assessment orders which were framed in the name of the amalgamating company in: (i) Dimension Apparels (supra); (ii) Micron Steels; and (supra) (ii) Micra India (supra). 21. ..... 24. A batch of Civil Appeals was filed before this Court against the decisions of the Delhi High Court, the lead appeal being Spice Enfotainment (supra). On 2 November 2017, a Bench of this Court consisting of Hon-ble Mr Justice Rohinton Fali Nariman and Hon'ble Mr Justice Sanjay Court Rasil dismissed the Civil Appeals and tagged Special Leave Petitions in terms of the following order: "Delay condoned. Heard the learned Senior Counsel appearing for the parties. We do not find any reason to interfere with the impugned judgment(s) passed by the High Court. In vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts were ascertained by the investigation unit. The reasons to believe referred to the assessment order for AY 2013-2014 and the findings recorded in it. Though the notice under Sections 147/148 was issued in the name of Skylight Hospitality Pvt. Ltd. (which had ceased to exist upon conversion into an LLP), there was, as the Delhi High Court held "substantial and affirmative material and evidence on record" to show that the issuance of the notice in the name of the dissolved company was a mistake. The tax evasion report adverted to the conversion of the private limited company into an LLP. Moreover, the reasons to believe recorded by the assessing officer adverted to the approval of the Principal Commissioner. The PAN number of the LLP was also mentioned in some of the documents. The notice under Sections 147/148 was not in conformity with the reasons to believe and the approval of the Principal Commissioner. It was in this background that the Delhi High Court held that the case fell within the purview of Section 2928 for the following reasons: "18...There was no doubt and debate that the notice was meant for the petitioner and no one else. Legal error and mistake was made in addr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch the court must abide by in promoting the interest of certainty in tax litigation. The view which has been taken by this Court in relation to the respondent for AY 2011-12 must, in our view be adopted in respect of the present appeal which relates to AY 2012-13. Not doing so will only result in uncertainty and displacement 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. 8. It may also be relevant to note that the Supreme Court in the case of Principal Commissioner of Income Tax vs. Mahagun Realtors (P) Ltd., reported in (2022) 443 ITR 194 had considered the decision of the Supreme Court in the case of Maruti Suzuki and it was held as under: "24. ..... whether corporate death of an entity upon amalgamation per se invalidates an assessment order ordinarily cannot be determined on a bare application of section 481 of the Companies Act, 1956 (and its equivalent in the 2013 Act), but would depend on the te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the transferor or amalgamating *(2019) 416 ITR 613 (SC); [2019] SCC Online SC 928. company. However, in the present case, the Assessing Officer or even the Revenue was not informed about the amalgamation. ..... 33. 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 the present case, however, can be distinguished from the facts in Spice and Maruti Suzuki on the following bases. 34. 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 the amalgamating/non-existent company. However, in the present case, for the assessment year 2006-07, there was no intimation by the assessee regarding amalgamation of the company. The return of income for the assessment year 2006-07 first filed by the respondent on June 30, 2006 was in the name of MRPL. MRPL amalgamated with MIPL on May 11, 2007, with effect from April 1, 2006. In the present case, the proceedings against MRPL started in August 27, 2008 when search and seizure was first conducted on the Mahagun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... particular method of expressing the tax liability. The Assessing Officer, on the other hand, had the option of making a common order, with MIPL as the assessee, but containing separate parts, relating to the different transferor companies (Mahagun Developers Ltd., Mahagun Realtors Pvt. Ltd., Universal Advertising Pvt. Ltd., ADR Home Décor Pvt. Ltd.). The mere choice of the Assessing Officer in issuing a separate order in respect of MRPL, in these circumstances, cannot nullify it. Right from the time it was issued, and at all stages of various proceedings, the parties concerned (i.e., MIPL) treated it to be in respect of the transferee company (MIPL) by virtue of the amalgamation order and section 394(2). Furthermore, it would be anybody-s guess, if any refund were due, as to whether MIPL would then say that it is not entitled to it, because the refund order would be issued in favour of a non-existing company (MRPL). Having regard to all these reasons, this court is of the opinion that in the facts of this case, the conduct of the assessee, commencing from the date the search took place, and before all forums, reflects that it consistently held itself out as the assessee. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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