North Bengal Promoters Private Limited v. Income Tax Officer, Ward

WPA 6424 of 2023 North Bengal Promoters Private Limited Vs. Income Tax Officer, Ward No.7(1), Kolkata & Ors. Mr. Anil Kumar Dugar,Mr. Rajarshi Chatterjee …for the petitioner. Mr., Smarajit Roy Chowdhury … for the respondents. Heard learned advocates appearing for the parties. In this writ petition, petitioner has challenged theimpugned notice dated April 20, 2021 relating toassessment year 2013-14 under section 148 of the IncomeTax Act, 1961 which is a transferor company on thegrounds that the impugned notice has been issued in thename of the company which has already beenamalgamated on 11.08.21. w.e.f. 01.04.2018 and that thedepartment has been intimated about this amalgamationwhich is matters of record and such notice in the name ofa non-existing company is not tenable in the eye of law. In support of his contention, learned advocate forthe petitioner has relied on a decision of the Gujarat HighCourt in the case of Takshashila Realties Pvt. Ltd. v.Deputy Commissioner of Income Tax reported in 2016SCC OnLine Guj 6462 and specifically relies onparagraph 10 of the said judgement which is hereinbelow:– “10. Heard the learned Counsels appearing onbehalf of the respective parties at length. At the outset, itis required to be noted and it is not in dispute that theimpugned notices under section 148 of the Income Tax Acthave been issued against the original assessee on21.01.2011 to reopen the assessment for the Assessmentyear 2009-10. It is also not in dispute that the respectivepetitioners-original assessee are ordered to beamalgamated with one Takshasila Gruh Nirman(Subsequently named as Takshashila Realties Pvt. Ltd).The scheme of amalgamation has been sanctioned by thisCourt, by which the respective petitioners are ordered tobe amalgamated into Takshashila Gruh Nirman(Subsequently named as Takshashila Realties Pvt. Ltd.)with effect from 01.04.2010. Under the circumstances,when the impugned notices are issued against the originalassessee-amalgamating Company on 21.01.2011, it can besaid that the same has been issued against the non-existent Company. It cannot be disputed that once thescheme for amalgamation has been sanctioned by theCourt with effect from 01.04.2010, from that dateamalgamating Company would not be in existence. Underthe circumstances, the impugned notices, which areissued against the non-existent Company, cannot besustained and the same deserves to be quashed and setaside. Identical question came to be considered by the Division Bench of this Court in the case of KhuranaEngineering Ltd. (supra). It was the case where theoriginal assessee Company was ordered to beamalgamated with effect from 01.04.2009. Notice undersection 148 of the Income Tax Act was issued against andthe transferor Company-amalgamating Company on20.06.2012. The Division Bench of this Court in a writpetition filed by the transferor Company has observed andheld that on and from the appointed date, as per thescheme of amalgamation sanctioned by the Court, thetransferor Company shall not be in existence, andtherefore, the impugned notices against the transferorCompany (non-existent Company) shall not be permissible.The Division Bench has observed that in such a situationthe assessment can always be made and is supposed to bemade on the transferee Company taking into account theincome of both the transferor and transferee Company andalso the more advisable course from the point of view ofthe revenue would be to make one assessment on thetransferee Company and to make separate protectiveassessments on both the transferor and transfereeCompanies separately ultimately, the Division Bench hasheld that the transferor Company would no longer beamenable to the assessment proceedings for theAssessment Year 2010-11, and therefore, notice for producing documents for such assessment would thereforebe invalid.” Learned advocate for the respondents in all herfairness has submitted that she has got no case and couldnot distinguish the aforesaid judgement of the Hon’bleGujarat High Court on the facts and law. producing documents for such assessment would thereforebe invalid.” Learned advocate for the respondents in all herfairness has submitted that she has got no case and couldnot distinguish the aforesaid judgement of the Hon’bleGujarat High Court on the facts and law. Considering the submission of the parties, I am ofthe view that the impugned notice dated April 20, 2021(Annexure P-2 to the writ petition) is not tenable in the eyeof law and all further steps pursuant to the said impugnednotice also are not tenable in the eye of law. This writpetition is allowed and the impugned notice is quashedsolely on the ground that the impugned notice was issuedin the name of non-existing company in spite of revenuehaving notice and knowledge of non-existence of suchCompany. Since no affidavits have been called for, allegationsmade in the writ petition are deemed to have been deniedby the respondents. Accordingly, WPA 6424 of 2023 is disposed of. (Md. Nizamuddin, J.)