Avadh Sugar And Energy Ltd And Anr v. Asst/Dy Commissioner Of Income Tax, Circle 11(1) Kol And Ors

OD – 1 ORDER SHEET WPO/2490/2022IN THE HIGH COURT AT CALCUTTACONSTITUTIONAL WRIT JURISDICTIONORIGINAL SIDE AVADH SUGAR AND ENERGY LTD AND ANRVSASST/DY COMMISSIONER OF INCOME TAX, CIRCLE 11(1) KOL ANDORS BEFORE:The Hon'ble JUSTICE MD. NIZAMUDDINDate : 7[th] September, 2022. Appearance:Mr. Asim Choudhury, Adv.Mr. Soham Sen, Adv.…For the PetitionerMr. Soumen Bhattacharjee, Adv.…For the U.O.I. The Court : Heard learned advocates appearing for the parties. By this writ petition, petitioner has challenged the impugnednotice dated 31[st] May, 2022 relating to assessment year 2015-16,under Section 148A of the Income Tax Act, 1961, on the ground thatthe noticee company is no more in existence and it has already beenamalgamated with effect from 1[st] April, 2015 by the order of the NCLTdated 2[nd] March, 2017 and the respondent department was intimatedon the amalgamation of the noticee company on 28[th] June, 2022. It isthe grievance of the petitioner that in spite of intimation of the factthat the assessee is not existing, still respondent is proceeding withthe impugned reassessment proceeding and submits that the wholeproceeding and the impugned notice are bad and not sustainable inlaw against the non-existing company. In support of his contention Mr. Choudhury, learned advocateappearing for the petitioner has relied on a decision of the Hon’bleGujarat High Court in the case of Takshashila Realties Pvt. Ltd. vs.Dy. Commissioner of Income Tax reported in 2016 SCC Online Guj6462 and specifically relies on Paragraph 10 of the said judgmentwhich is hereinbelow : “10. Heard the learned Counsels appearing on behalf of therespective parties at length. At the outset, it is required to be notedand it is not in dispute that the impugned notices under Section 148of the Income Tax Act have been issued against the original assesseeon 21.01.2011 to reopen the assessment for the Assessment year2009-10. It is also not in dispute that the respective petitioners-original assessee are ordered to be amalgamated with one TakshashilaGruh Nirman (Subsequently named as Takshashila Realties Pvt. Ltd).The scheme of amalgamation has been sanctioned by this Court, bywhich the respective petitioners are ordered to be amalgamated intoTakshashila Gruh Nirman (Subsequently named as TakshashilaRealties Pvt. Ltd.) with effect from 01.04.2010. Under thecircumstances, when the impugned notices are issued against theoriginal assessee-amalgamating Company on 21.01.2011, it can besaid that the same has been issued against the non-existentCompany. It cannot be disputed that once the scheme foramalgamation has been sanctioned by the Court with effect from01.04.2010, from that date amalgamating Company would not be inexistence. Under the circumstances, non existent Company, cannot be sustained and the same deserves to be quashed and set aside.Identical question came to be considered by the Division Bench of thisCourt in the case of Khurana Engineering Ltd. (Supra). It was the casewhere the original assessee Company was ordered to be amalgamatedwith effect from 01.04.2009. Notice under Section 148 of the IncomeTax Act was issued against and the transferor Company-amalgamating Company on 20.6.2012. The Division Bench of thisCourt in a writ petition filed by the transferor Company has observedand held that on and from the appointed date, as per the scheme ofamalgamation sanctioned by the Court, the transferor Company shallnot be in existence, and therefore, the impugned notices against thetransferor Company (non-existent Company) shall not be permissible.The Division Bench has observed that in such a situation theassessment can always be made and is supposed to be made on thetransferee Company taking into account the income of both thetransferor and transferee Company and also the more advisablecourse from the point of view of the revenue would be to make oneassessment on the transferee Company and to make separateprotective assessments on both the transferor and transfereeCompanies separately transferor Company would no longer beamenable to the assessment proceedings for the Assessment Year2010-11, and therefore, notice for producing documents for suchassessment would therefore be invalid.” Learned advocate appearing for the respondent is not in aposition to contradict the admitted facts as appear from records. Considering the submissions of the parties, I am of the view thatthe impugned notice dated 31[st] May, 2022 (Annexure P-13 to the writpetition) is not tenable in the eye of law and all further steps pursuantto the said impugned notice also are not tenable in the eye of law. Thiswrit petition is allowed and the impugned notice is quashed solely onthe ground that the impugned notice was issued in the name of non-existing company in spite of revenue having notice and knowledge ofnon-existence of such Company. Since no affidavits have been called for, allegations made in thewrit petition are deemed to have been denied by the respondents.Accordingly, WPO 2490 of 2022 is disposed of. (MD. NIZAMUDDIN, J.) TR/