DCIT, New Delhi v. M/s. Transcend MT Services Pvt. Ltd., New Delhi

ITA 2697/DEL/2014 | 2007-2008
Pronouncement Date: 30-11-2017 | Result: Dismissed

Appeal Details

RSA Number 269720114 RSA 2014
Assessee PAN AABCH2275E
Bench Delhi
Appeal Number ITA 2697/DEL/2014
Duration Of Justice 3 year(s) 6 month(s) 28 day(s)
Appellant DCIT, New Delhi
Respondent M/s. Transcend MT Services Pvt. Ltd., New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 30-11-2017
Appeal Filed By Department
Tags No record found
Order Result Dismissed
Bench Allotted I2
Tribunal Order Date 30-11-2017
Date Of Final Hearing 29-06-2017
Next Hearing Date 29-06-2017
First Hearing Date 29-06-2017
Assessment Year 2007-2008
Appeal Filed On 02-05-2014
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH I - 2 NEW DELHI BEFORE SHRI N.K. SAINI ACCOUNTANT MEMBER BEFORE MS. BEENA PILLAI JUDICIAL MEMBER I.T.A. NO. 2697 /DEL /201 4 ASSESSMENT YEAR: 2007 - 08 DCIT CIRCLE - 16(1) NEW DELHI VS. TRANSCEND MT SERVICES PVT. LTD. PLOT NO. 14 SAGAR TOWER DISTRICT CENTRE JANAKPURI NEW DELHI PAN - AABCH2275E [APPELLANT] [RESPONDENT] C.O. NO. 163/DEL/2017 (IN ITA NO. 2697/DEL/2014) TRANSCEND MT SERVICES PVT. LTD. PLOT NO. 14 SAGAR TOWER DISTRICT CENTRE JANAKPURI NEW DELHI PAN - AABCH2275E VS. DCIT CIRCLE - 16(1) NEW DELHI [APPELLANT] [RESPONDENT] DEPARTMENT BY: SH. SANJAY KUMAR YADAV SR. DR RESPONDENT BY: SH. VISHAL KALRA ADV SH. ANKIT SAHNI ADV & S.S. TOMAR ADV DATE OF HEARING: 30 11 2017 DATE OF PRONOUNCEMENT: 30 11 2017 O R D E R PER N.K. SAINI A.M: TH E APPEAL OF THE DEPARTMENT AND THE CROSS OBJECTION BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER DATED 4.2.2014 OF THE LD. CIT(A) - XX NEW DELHI . THE DEPARTMENT HAS RAISED THE FOLLOWING GROUNDS IN ITS APPEAL: - ITA NO. 26 97 /DEL/201 4 CO NO. 163/DEL/2017 2 I . LD. CIT(A) HAD REJECTED THE COMPARABLES / UPWARD ADJUSTMENT MADE BY THE AO / TPO AND DIRECTED THE AO TO REJECT SOME COMPARABLES SO THAT ARM S LENGTH MARGIN COMES WITHIN RANGE OF 5% . II . LD. CIT(A) HAD ERRED IN ALLOWING DEDUCTION AMOUNTING TO RS. 2 28 87 852/ - U/S 10A OF THE ACT. III . THE APPELLANT CRAVES FOR RESER VING THE RIGHT TO AMEND MODIFY ALTER ADD OR FOREGO ANY GROUND(S) OF APPEAL AT ANY TIME BEFORE OR DURING THE HEARING OR APPEAL. 2. THE GRO UNDS RAISED BY THE ASSESSEE IN ITS CROSS OBJECTIONS ARE FOLLOWING : 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE CIT(A) ERRED IN UPHOLDING THE ORDERS OF THE ASSESSING OFFICER (AO) / TRANSFER PRICING OFFICER (TPO) WHICH WERE ARBITRARY BAD IN LAW AND / OR VOID AB INITIO. 1.1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE AO / TPO HAVE GROSSLY ERRED IN PASSING THE ORDER UNDER SECTION(S) 143(3) / 92CA OF THE ACT ON NON - EXISTENT (AMALGAMATED) ENTITY NAME LY HEARTLAND DELHI TRANSCRIPTION & SERVICES PRIVATE LIMITED. FURTHER CIT(A) ERRED IN UPHOLDING SUCH ORDER(S). 2. THAT THAT CIT(A) ERRED ON FACTS AND IN LAW IN UPHOLDING THE ACTION OF THE AO IN INVOKING THE PROVISIONS OF CHAPTER X SPECIAL PROVISIONS RELATING TO AVOIDANCE OF TAX OF THE ACT WITHOUT APPRECIATING THAT THERE WOULD HAVE BEEN NOT PROFIT SHIFTING FROM INDIA. 3. THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN UPHOLDING THE ORDER OF THE AO / TPO IN MODIFYI NG FILTERS AND / OR COMPARABLES SET ADOPTED BY THE ASSESSEE IN ITS TRANSFER PRICING STUDY. 4. THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN UPHOLDING THE ORDER OF THE AO / TPO IN SELECTING COMPANIES WITH HIGH TURNOVER AND / OR INTELLECTUAL PROPERTY RIGHTS AS COMPARABLE TO THE ASSESSEE SUCH AS: I. INFOSYS BPO LIMITED; II. WIPRO LIMITED III. HCL COMNET SYSTEMS & SERVICES LIMITED; AND IV. ADITYA BIRLA MINACS WORLDWIDE LTD. 5. THAT THE CIT(A) ERRED ON FACTS AND IN LAW UPHOLDING THE ORDER OF THE AO / TPO IN SELECTING FUNCTIONALLY DIFFERENT COMPANIES AS COMPARABLE TO THE ASSESSEE SUCH AS I. BODHTREE CONSULTING LIMITED; II. INFORMED TECHNOLOGIES INDIA LIMITED; AND III. APEX KNOWLEDGE SOLUTIONS. ITA NO. 26 97 /DEL/201 4 CO NO. 163/DEL/2017 3 6. THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN UPHOLDING THE ORDER OF THE AO / TPO IN SELECTING COMPANY WITH ABNORMAL PROFIT MARGIN NAMELY ISERVICES INDIA PRIVATE LIMITED. 7. THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN NOT ALLOWING ADJUSTMENT ON ACCOUNT OF DIFFERENCE IN WORKING CAPITAL AND / OR RISK ASSUMED BY THE ASSESSEE VIS A VIS THE COMPARABLE COMPANIES. 3. F ROM THE ABOVE GROUNDS I T IS GATHERED THAT THE GRIEVANCE OF THE ASSESSEE RELATES TO THE UPHOLDING OF THE ASSESSMENT ORDER PASSED BY THE AO U/S 143(3) / 92 CA OF THE INCOME TAX ACT 1961 (HEREINAFTER REFERRED TO AS THE ACT ) ON THE NON - EXISTEN T AMALGAMATED ENTITY INSTEAD OF AMALGAMAT ING COMPANY. 4 . FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE FILE D ITS RETURN O F INCOME ON 31.10.2007 DECLARING A N INCOME OF RS. 1 87 762/ - WHICH WAS PROCESSED U/S 143(1) OF THE ACT. LATER ON THE CASE WAS SEL ECTED FOR SCRUTINY . S INCE THERE WERE INTERNATIONAL TRANSACTIONS THE AO REFERRED THE MATTER TO THE TPO U/S 92 CA OF THE ACT. THE TPO PROPOSED THE ADJUSTMENT ON ACCOUNT OF ARM S LENGTH PRICE. ACCORDINGLY THE AO ENHANCED THE INCOME BY RS. 1 54 79 764/ - IN THE DRAFT ASSESSMENT ORDER . T HE AO FRAMED THE ASSESSMENT U/S 144 C / 143( 3) OF THE ACT AND DETERMINED THE ARM S LENGTH PRICE OF BACK OFFICE TO THE MEDICATION PRESCRIPTION SERVICES AT RS. 16 93 17 347/ - AS AGAINST THE BOOK VALUE OF THOSE INTERNATIONAL T RANSACTIONS DECLARED BY THE ASSESSEE AT RS. 15 38 37 583/ - . A CCORDINGLY THE ADDITION OF RS. 1 54 79 764/ - WAS MADE AND ASSESSMENT WAS FRAMED AT AN INCOME OF RS. 3 85 65 380/ - BY MAKING TRANSFER PRICING ADJUSTMENT AND DISALLOWANCE OF DEDUCTION U/S 10A OF TH E ACT AMOUNTING TO RS. 2 28 87 852/ - . 5 . BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER BEFORE THE LEARNED CIT(A) WHO SUSTAINED THE ADDITION MADE BY THE AO ON ACCOUNT OF TRANSFER PRICING ADJUSTMENT AMOUNTING TO 1 54 79 764/ - AND DELETED THE DISALLOWANCE OF DEDUCTION U/S 10A OF THE ACT AMOUNTING TO RS. 2 28 87 852/ - . ITA NO. 26 97 /DEL/201 4 CO NO. 163/DEL/2017 4 6 . NOW THE DEPARTMENT IS IN APPEAL AGAINST THE RELIEF ALLOWED AND THE ASSESSEE HAS FILED THE CROSS OBJECTION CHALLENGING THE VALIDITY OF THE ASSESSMENT ORDER PAS SED BY THE AO ON THE NON - EXISTENT ( AMALGAMATED ENTITY) NAMELY M/S HEARTLAND INFORMATION AND CONSULTANCY SERVICES PVT. LTD. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE COMPANY WAS AMALGAMATED WITH M/S HEARTLAND INFORMATION AND CONSULTANCY SERVICES PVT. LTD. BANGALORE (HICS) AND IN THIS REGARD LETTER DATED 19 TH OCTOBER 2008 WAS FILED WITH THE AO INFORMING HIM THAT PURSUANT TO THE ORDER DATED 25.07.2008 OF THE HON BLE HIGH COURT AT NEW DELHI M/S HEARTLAND DEL H I TRANS CRIPTION AN D SERVICES PVT. LTD. (HDTS) H AS AMALGAMATED WITH M/S HEARTLAND INFORMATION AND CONSULTANCY PVT. LTD . (HICS) A CERTIFIED COPY OF THE ORDER OF THE HON BLE DELHI HIGH COURT WAS FILED WITH THE REGISTRAR OF COMPANIES ON 17 TH SEPTEMBER 2008 . IT WAS STATED THAT M/S HDTS HAS CEASED TO EXISTS I.E. DISSOLVED WITHOUT BINDING UP AND HICS HAS TAKEN OVER THE ASSESSEE S LIABILITIES RESPONSIBILITIES AND OBLIGATIONS. IT WAS FURTHER STATED THAT AFORESAID INFORMATION WAS ALSO GIVEN TO THE TPO AND THE LD. CIT(A) - 4 DELHI VI DE LETTERS OF THE E VEN DATES. OUR ATTENTION WAS DRAWN TOWARDS PAGE NOS. 900 TO 907 OF THE ASSESEE S PAPER BOOK WHICH ARE THE COPIES OF THE SAID LETTER S WRITTEN TO THE RESPECTIVE AUTHORITIES. IT WA S FURTHER SUBMITTED THAT THE ASSESSMENT HAS BEEN FRAMED BY THE AO ON THE ERSTWHILE AMALGAMATED COMPANY I.E. M/S HEARTLAND DELHI TRANSCRIPTION AND SERVICES PVT. LTD. (HDTS) VIDE ORDER DATED 22.2.2011 ON THE SAID DATE THE SAID COMPANY WAS NOT IN EXISTENCE THEREFORE ASSESSMENT FRAMED WAS VOID AB INITIO . THE RELIANCE WAS PLACED ON THE FOLLOWING CASE LAWS: - S. NO. PARTICULARS 1. CIT VS. SPICE ENFOTAINMENT LTD. [TS - 504 - SC - 2017] (SC) 2. SPICE ENTERTAINMENT LIMITED VS. COMMISSIONER OF SERVICE TAX (ITA 476 OF 2011) (DELHI) [2012 (280) EL T43 (DEL.)] 3. PCIT VS. MARUTI SUZUKI INDIA LIMITED [2017] 85 TAXMANN.COM 330 (DELHI) 4. MARUTI SUZUKI INDIA LIMITED VS. DCIT [2016] 72 TAXMANN.COM 164 (DEL - TRIB.) ITA NO. 26 97 /DEL/201 4 CO NO. 163/DEL/2017 5 5. CIT VS. MICRA INDIA (P) LIMITED [2015] 231 TAXMANN 809 (DELHI) 6. CIT VS. DIMENSION APPARELS (P) LIMITED [2015] 370 ITR 288 (DELHI) 7. SAMSUNG INDIA ELECTRONICS PVT. LTD VS. DCIT (ITA NO. 6452/DEL/2013) (DEL - TRIB.) 8. DCIT VS. SATWAT EXPORTS PVT. LTD (ITA NO. 5963/D/2013) (DEL - TRIB.) 7 . IN HIS RIVAL SUBMISSIONS THE LEARNED DR STRONGLY SUPPORTED THE ORDER OF THE LEARNED CIT(A) AND FURTHER SUBMITTED THAT THE ASSESSEE DID NOT RAISE THE OBJECTIONS EITHER BEFORE THE AO OR BEFORE THE LEARNED CIT(A) AND PARTICIPAT ED IN THE ASSESSMENT PROCEEDINGS THEREFORE IN VIEW OF THE PROVISIONS CONTAINED IN SECTION 292 B OF THE ACT THE ASSESSEE HAS NO RIGHT TO CHALLENGE THE VALIDITY OF THE ASSESSMENT AT THIS STAGE. 8. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AN D PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CASE IT IS AN ADMITTED FACT THAT THE ASSESSEE M/S HEARTLAND DELHI TRANSCRIPTION AND SERVICES PVT. LTD. (HDTS) AMALGAMATED WITH M/S HEARTLAND INFORMATION AND CONSULTANCY PVT. LTD. (HICS) IN PURSUANT TO THE ORDER OF THE HON BLE DELHI HIGH COURT DATED 25 TH JULY 2008 AND THIS FACT WAS BROUGHT TO THE NOTICE OF THE AO (INCOME TAX OFFICER WARD - 12 (3) DIRECTOR OF INCOME TAX TP - 1 NEW DELHI ADDITI ONAL COMMISSIONER OF INCOME TAX - 12 NEW DELHI AND COMMISSIONER OF INCOME TAX - 4 NEW DELHI VIDE SEPARATE LETTERS EACH DATED 19 TH OCTOBER 2008 COPIES OF WHICH ARE PLACED AT PAGE 900 TO 907 OF THE ASSESSEE S PAPER BOOK AND ORDER OF THE HON BLE DELHI HIGH COURT DATED 25 TH JULY 2008 FOR THE AFORESAID AM ALGAMATION IS PLACED AT PAGE NO. 908 TO 918 OF THE ASSESSEE S PAPER BOOK. IT IS ALSO NOTICED THAT THE AO REFERRED THE MATTER U/S 92 CA OF THE ACT OF THE AMALGAMATED COMPANY M/S (HDTS) TO THE TPO WHO PASSED THE ORDER DATED 25.10.2010 ON THE AFORESAID ENTITY. THE AO ALSO PASSED THE ASSESSMENT ORDER DATED 22.2.2011 U/S 144C / 143(3) OF THE ACT ON THE AFORESAID ENTITY I.E. HDTS WHICH AMALGAMATED IN HICS THEREFORE IT IS CRYSTAL CLEAR THAT THE ENTITY M/S ITA NO. 26 97 /DEL/201 4 CO NO. 163/DEL/2017 6 (HDTS) WAS NOT IN EXISTENCE WHEN THE TPO AS WELL AS THE AO PASSED THEIR RESPECTIVE ORDER. 9 . ON A SIMILAR ISSUE THE ITAT DELHI BENCH I - 1 NEW DELHI HAVING THE SAME COMBINATION PASSED A DETAILED ORDER AUTHORED BY THE AM IN THE CASE OF MARUTI SUZUKI INDIA LTD. VS. DY. CIT REPORTED IN (2016) 72 TAXMANN.COM. 164. AND THE RELEVANT FINDINGS HAVE BEEN GIVEN AS UNDER : - 10 . WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL LE ON THE RECORD. IN THE PRESENT CASE IT IS AN ADMITTED FACT THAT THE AMALGAMATING COMPANY M/S POWERTRAIN INDIA LTD. AMALGAMATED WITH M/S MARUTI SUZUKI INDIA LTD. W.E.F. 01.04.2012 AS A OF SCHEME OF AMALGAMATION DULY APPROVED BY THE HON'BLE DELHI HIGH COURT VIDE ORDER DATED 2013 AND THE ASSESSMENT IN THIS HAS BEEN FRAMED BY THE AO VIDE ORDER DATED 03.03.2015. THEREFORE DEAR THAT WHEN THE ASSESSMENT ORDER WAS PASSED ON 03.03.2015 M/S SUZUKI POWERTRAIN INDIA LTD. LOT INEXISTENCE. IT IS ALSO NOTICED THAT THE AFORESAID FACT WAS IN THE KNOWLEDGE OF THE DEPARTMENT AS THE INFORMED VIDE VARIOUS LETTERS MENTIONED IN PARA 5 OF THE FORMER PART OF THIS ORDER WHICH WERE TO THE VARIOUS TAX AUTHORITIES. HOWEVER THE AO IN SPITE OF KNOWING THIS FACT THAT M/S SUZUKI IN INDIA LTD. AMALGAMATED WITH M/S MARUTI SUZUKI INDIA LTD. MADE THE REFERENCE TO THE TPO AND - SUED THE NOTICE DATED 07.11.2014 TO THE NON - EXISTENT ENTITY I.E. M/S SUZUKI POWERTRAIN INDIA LTD. 11 . A SIMILAR ISSUE THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF MICRA INDIA (P.) LTD. {SUPRA) UNDER: IN THE INSTANT CASE NO DOUBT THERE WAS PARTICIPATION DURING THE COURSE OF ASSESSMENT; HOWEVER THE ASSES S ING OFFICER DESPITE BEING TOLD THAT THE ORIGINAL COMPANY WAS NO LONGER IN EXISTENCE DID NOT LE REMEDIAL MEASURES AND DID NOT TRANSPOSE THE TRANSFEREE AS TH E COMPANY WHICH HAD TO BE ASSESSED INST EAD HE RESORTED TO A PECULIAR PROCEDURE OF DESCRIBING THE ORIGINAL ASSESSEE AS THE ONE IN EXISTENCE; ORDER ALSO MENTIONED THE TRANSFEREE'S NAME BELOW THAT OF ASSESSEE'S COMPANY. NOW THAT DID NOT TO THE ASSESSMENT B EING COMPLETED IN THE NAME OF THE TRANSFEREE - COMPANY. ACCORDING TO THE SING OFFICER THE ASSESSEE - COMPANY WAS STILL IN EXISTENCE. CLEARLY THIS WAS A CASE WHERE THE ASSESS SMENT WAS CONTRARY TO LAW AS HAVING BEING COMPLETED AGAINST A NON - EXISTENT COMPANY. THE TRI BUNAL'S DECISION IS IN THE CIRCUMSTANCES JUSTIFIED AND WARRANTED.' 12 . SIMILARLY THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SPICE INFOTAINMENT LTD. V. CIT [IT NOS. 475 & 476 OF 2011 DATED 3 - 8 - 2011] HELD AS UNDER: NO DOUBT M/S SPICE WAS AN ASSESSEE AND AS AN INCORPORATED COMPANY AND WAS IN EXISTENCE WHEN IT THE RETURNS IN RESPECT OF TWO ASSESSMENT ITA NO. 26 97 /DEL/201 4 CO NO. 163/DEL/2017 7 YEARS IN QUESTION. HOWEVER BEFORE THE CASE COULD BE TED FOR SCRUTINY AND ASSESSMENT PROCEEDINGS COULD BE INITIATED M/S S PICE GOT AMALGAMATED WITH M CORP PVT. LTD. IT WAS THE RESULT OF THE SCHEME OF THE AMALGAMATION FILED BEFORE THE COMPANY JUD GE OF THIS COURT WHICH WAS DULLY SANCTIONED VIDE ORDERS DATED 11TH FEBRUARY 2004. WITH THIS AMAL GAMATION MADE EFFECTIVE FROM 1ST JULY 2003 M/S SPICE CEASED TO EXIST. THAT IS THE PLAIN AND LE EFFECT IN LAW. THE SCHEME OF AMALGAMATION ITSELF PROVIDED FOR THIS CONSEQUENCE INASMUCH AS SIMULTANEOUS WITH THE SANCTIONING OF THE SCHEME M/S SPICE WAS ALSO STOOD DISSOLVED BY SPECIFIC OF THIS COURT. WITH THE DISSOLUTION OF THIS COMPANY ITS NAME WAS STRUCK OFF FROM THE ROLLS COMPANIES MAINTAINED BY THE REGISTRAR OF COMPANIES. A COMPANY INCORPORATED UNDER THE INDIAN COMPANIES ACT IS A JURISTIC PERSON. IT TAKE S ITS BIRTH AND GETS LIFE WITH THE INCORPORATION. IT DIES WITH THE DISSOLUTION AS PER THE PROVISIONS OF THE COMPANIES ACT. IT IS TRITE LAW THAT ON AMALGAMATION THE AMALGAMATING COMPANY CEASES TO EXIST IN THE EYES OF LAW. IN VIEW OF THE AFORESAID CLINCHING POSITION IN LAW IT IS DIFFICULT TO DIGEST THE CIRCUITIOUS ROUTE ADOPTED BY THE TRIBUNAL HOLDING THAT THE ASSESSMENT WAS IN FACT IN THE NAME OF AMALGAMATED COMPANY AND THERE WAS ONLY A PROCEDURAL DEFECT. AFTER THE SANCTION OF THE SCHEME ON 11TH APRIL 200 4 THE SPICE CEASED TO EXIT W.E.F 1ST JULY 2003. EVEN IF SPICE HAD FILED THE RETURNS IT BECAME INCUMBENT UPON THE INCOME TAX AUTHORITIES TO SUBSTITUTE THE SUCCESSOR IN PLACE OF THE SAID 'DEAD PERSON'. WHEN NOTICE UNDER SECTION 143 (2) WAS SENT THE APPEL LANT/AMALGAMATED COMPANY APPEARED AND BROUGHT THIS FACT TO THE KNOWLEDGE OF THE AO. HE HOWEVER DID NOT SUBSTITUTE THE NAME OF THE APPELLANT ON RECORD INSTEAD THE AO MADE THE ASSESSMENT IN THE NAME OF M/S SPICE WHICH WAS NON - EXISTING ENTITY ON THAT DAY. IN SUCH PROCEEDINGS AND ASSESSMENT ORDER PASSED IN THE NAME OF M/S SPICE WOULD CLEARLY BE VOID SUCH A DEFECT CANNOT BE TREATED AS PROCEDURAL DEFECT. MERE PARTICIPATION BY THE APPELLANT WOULD BE OF NO EFFECT AS THERE IS NO ESTOPPEL AGAINST LAW. ' IT HAS BE EN FURTHER HELD AS UNDER: '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 292B. THE FRAMING OF ASSESSMENT AGAINST A NON - EXISTING ENTITY/PERSON GOES TO THE ROOT OF THE MATTER WHICH IS NOT A PROCEDURAL IRREGULARITY BUT A JURISDICTIONAL DEFECT AS THERE CANNOT BE ANY ASSESSMENT AGAINST A 'DEAD PER SON'.' 13 . IN THE PRESENT CASE ALSO AS THE ASSESSMENT WAS FRAMED IN THE NAME OF NON - EXISTING ENTITY I.E. M/S SUZUKI POWERTRAIN INDIA LTD. WHICH AMALGAMATED WITH M/S MARUTI SUZUKI INDIA LTD. AND THIS IRREGULARITY WAS NOT CURABLE. THEREFORE THE ASSESSMENT ORDER PASSED BY THE AO IN THE NAME OF NON - EXISTING ENTITY WAS VOID AB INITIO AND DESERVES TO BE QUASHED WE ORDER ACCORDINGLY. 14 . ON THE PRESENT CASE THE CONTENTION OF THE ID. CIT DR WAS THAT THE ASSESSMENT WAS RIGHTLY FRAMED BY THE AO ON THE ASSESSEE WHO FILED THE RETURN ITA NO. 26 97 /DEL/201 4 CO NO. 163/DEL/2017 8 OF INCOME AND WHEN THE INCOME WAS EARNED IT WAS INEXISTENCE. THIS CONTROVERSY HAS BEEN SETTLED BY THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V. DIMENSI ON APPARELS (P.) LTD . [2015] 370 ITR 288/[2014] 52 TAXMANN.COM 356 (DELHI ) WHEREIN IT HAS BEEN HELD AS UNDER: 'SECTION 170(2) OF THE INCOME - TAX ACT 1961 MAKES IT CLEAR THAT IN THE CASE OF AMALGAMATION THE ASSESSMENT MUST BE MADE ON THE SUCCESSOR (I.E. THE AMALGAMATED COMPANY). SECTION 176 WHICH CONTAINS PROVISIONS PERTAINING TO A DISCONTINUATION OF BUSINESS DOES NOT APPLY TO A CASE OF AMALGAMATION. THE LANGUAGE OF SECTION 159 EVIDENTLY ONLY APPLIES TO NATURAL PERSONS AND CANNOT BE EXTENDED THROUGH A LE GAL FICTION TO THE DISSOLUTION OF COMPANIES. 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 292B. PARTICIP ATION BY THE AMALGAMATED COMPANY IN ASSESSMENT PROCEEDINGS WOULD NOT CURE THE DEFECT BECAUSE 'THERE CAN BE NO ESTOPPELS AGAINST LAW.' 15 . IN THE PRESENT CASE ALSO WHEN THE ASSESSMENT WAS FRAMED BY THE AO VIDE ORDER DATED 29.12.2015 IN THE NAME OF M/S SUZUKI PO WERTRAIN INDIA LTD. THE SAID COMPANY HAD ALREADY AMALGAMATED WITH M/S MARUTI SUZUKI INDIA LTD. AND THEREFORE IT WAS NOT INEXISTENCE. MOREOVER IT IS CLEAR FROM THE PROVISIONS OF SECTION 170(2) OF THE ACT THAT IN THE CASE OF AMALGAMATION THE ASSESSMENT M UST BE MADE ON THE SUCCESSOR I.E. THE AMALGAMATED COMPANY AND NOT ON THE PREDECESSOR I.E. AMALGAMATING COMPANY. THEREFORE IN THE PRESENT CASE THE ASSESSMENT FRAMED BY THE AO VIDE ORDER DATED 29.12.2015 ON THE AMALGAMATING COMPANY I.E. M/S SUZUKI POWERTRA IN INDIA LTD. WHICH WAS NOT INEXISTENCE ON THE DATE OF PASSING THE ASSESSMENT ORDER WAS NOT VALID AND AS SUCH THE SAME IS QUASHED. SINCE WE HAVE ALLOWED GROUND NO. 1 OF THE ASSESSEE AND ASSESSMENT ORDER IS QUASHED THEREFORE NO FINDING IS GIVEN ON THE OTH ER ISSUES RAISED BY THE ASSESSEE. 10. IT IS ALSO RELEVANT TO POINT THAT THE ORDER OF THE ITAT IN THE CASE OF MARUTI SUZUKI PVT. LTD. VS. DCIT CIRCLE 16(1) NEW DELHI (SUPRA) HAS BEEN UPHELD BY THE HON BLE JURISDICTIONAL HIGH COURT VIDE ORDER DATED 4 TH SEPTEMBER 2017 IN THE CASE OF PRINCIPAL COMMISSIONER OF INCOME TAX NEW DELHI VS. MARUTI SUZUKI PRIVATE LTD. ( 2017 ) 85.COM 330 WHEREIN IT HAS BEEN HELD AS UNDER: - THE REVENUE HAS REPEATEDLY BROUGHT THE ISSUE BEFORE THE COURT IN A LARGE NUMBER OF CASES WHERE IN MORE OR LESS IDENTICAL CIRCUMSTANCES THE ASSESSING OFFICER HAD PASSED THE ASSESSMENT ORDER IN THE NAME OF THE ENTITY THAT HAD CEASED TO EXIST AS ON THE DATE OF THE ASSESSMENT ORDER. IN MANY OF THESE CASES AS IN THE PRESENT CASE THE ASSESSING OFFICER AFTER MENTIONING THE NAME OF THE AMALGAMATING COMPANY AS THE ASSESSEE MENTIONED BELOW IT THE ITA NO. 26 97 /DEL/201 4 CO NO. 163/DEL/2017 9 NAME OF THE AMALGAMATED COMPANY. THE SUBMISSION OF REVENUE THAT UNDER SECTION 292B THE SUCCESSOR - IN - INTEREST IS PRECLUDED FROM RAISING AN OBJECTION IF IT HAS PARTICIPATED IN THE ASSESSMENT PROCEEDINGS WAS NEGATIVED IN SPICE INFOTAINMENT LTD. V. CIT [2012] 247 CTR (DEL.) 500 WHEREIN IT WAS HELD THAT ONCE IT WAS FOUND T HAT THE ASSESSMENT WAS FRAMED IN THE NAME OF A NON - EXISTENT ENTITY IT DID NOT REMAIN A PROCEDURAL IRREGULARITY OF THE NATURE WHICH COULD BE CURED BY INVOKING THE PROVISIONS OF SECTION 292 - B. THE LEGAL POSITION HAVING BEEN MADE ABUNDANTLY CLEAR THERE IS NO HESITATION IN HOLDING THAT IMPUGNED ORDER PASSED BY TRIBUNAL DOES NOT REQUIRE ANY INTERFERENCE THE APPEAL IS ACCORDINGLY DISMISSED. 11. RECENTLY THE HON BLE APEX COURT DISMISSED THE SLP MOVED BY THE DEPARTMENT IN THE CASE OF M/S SPICE E NFOTAINMENT LTD. WHICH HAS BEEN FOLLOWED IN THE AFORESAID REFERRED CASE OF M/S MARUTI SUZUKI PVT. LTD. VS. DCIT VIDE ORDER DATED 2 ND NOVEMBER 2017. 12 . IN THE PRESENT CASE ALSO THE ASSESSMENT WAS FRAME D BY THE AO ON THE NON - EXISTENT AMALGAMATED COMPANY NOT ON THE AMALGAMATING COMPANY . T HEREFORE THE ASSESSMENT FRAMED WAS VOID AB INITIO AND ACCORDINGLY THE SAME IS QUASHED. SINCE WE HAVE QUASHED THE ASSESSMENT FRAMED BY THE AO THEREFORE NO SEPARATE FINDING IS BEING GIVEN ON THE ISSUES RAISED IN THE DEPAR TMENTAL APPEAL. 1 3 . IN THE RESULT THE APPEAL OF THE DEPARTMENT IS DISMISSED AND CROSS OBJECTIONS OF THE ASSESSEE ARE ALLOWED. (ORDER P RONOUNCE D IN THE OP EN ON 30 .1 1 .2017. ) SD/ - SD/ - [BEENA A PILLAI] [ N.K. SAINI ] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 30. 11 .2017 SH ITA NO. 26 97 /DEL/201 4 CO NO. 163/DEL/2017 10 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR