Income Tax Office Ward 23(3) vs Registrar Of Companies And Ors.

Dr. V.K. Subburaj, Member (T)

This appeal has been filed by Income Tax Authority invoking the provisions of Section 252 of the Companies Act, 2013 for restoration of the name of the Respondent No. 2 company, viz M/s. Shri Vasudev Irons Pvt. Ltd, in the Register of Companies maintained by the Registrar of Companies ("RoC"), Respondent No. 1.

Service was duly effected on the Respondents. Other than the RoC, none appeared on behalf of the other Respondents to oppose the prayer made by the Appellant. The RoC submitted that they have no objections to the prayer of the Appellant being granted by this Tribunal.

Vide proceedings initiated by the Ministry of Corporate Affairs, through the office of the RoC several names of companies were struck off for want of statutory filings. Respondent No. 2 company, which had also not filed any returns or financial statements was duly struck off from the register of companies.

Invoking the provision of section 252 of the Act, the Income Tax Dept. prays for its restoration in order to carry out proceedings initiated against Respondent 2. As per averments, information has been received from the DDIT (Inv.)-1, Ghaziabad intimating that verification of STR was carried out in the case of M/s. GP Trading and was revealed that M/s. GP Trading is a partnership firm of Shri Anil Kumar Singhal and Smt. Anita Singhal. Smt. Anita Singhal is also one of the directors of respondent company. During the course of enquiry Smt. Anita Singhal denied to have any knowledge of the business activities and books of account of M/s. GP Trading and M/s. Vasudev Irons Pvt. Ltd. She only stated that her husband Shri Anil Kumar Singhal might be knowing about these. Shri Anil Kumar Singhal, in his statement admitted to have provided bogus accommodation entries through respondent company.

Further verification was done by DDIT (Inv), New Delhi for the FY 2011-12, AY 2012-13 and it was informed that the respondent company maintained bank account No. 017006400000094 with Dhanlakshmi Bank, Karol Bagh, New Delhi wherein there are total debits and credits worth Rs. 88.93 crores and Rs. 89.92 crores respectively as against the turnover of Rs. 49.24 crores on which net profit of Rs. 35,964/- only has been declared in the ITR.

After examining the information from two authorities and making further verification, the Assessing Officer observed the difference of Rs. 40.67 crores in turnover declared in the ITR for A.Y. 2012-13 and the actual credits received in the bank account and sent a notice u/s 133(6) of the IT Act by email as well as through Speed Post, but the same remained uncomplied with. In the absence of any reply/explanation, the difference remained unexplained.

As the respondent company has failed to disclose true and complete particulars in its ITR, the Assessing Officer has reasons to believe that amount exceeding Rs. 1,00,000/- has escaped assessment for A.Y. 2012-13 within the meaning of Section 147 of the I.T. Act thereby rending the company liable for consequences under Income Tax Act, 1961, and entitling the Revenue to initiate proceedings against the company. Thus, prima facie, there appears tax evasion which requires action in accordance with law.

Notice dated 28.03.2019 under section 148 of the IT Act of A.Y 2012-13 has been issued to the respondent company for initiating reassessment proceedings.

The said proceedings for assessment of income of the respondent company for A.Y. 2012-13 initiated by issue of Notice dated 28.03.2019 are pending and will be getting time barred by limitation on 31.12.2019 as per the provisions of section 153(2) of Income Tax Act, 1961.

On perusal of the MCA, appellant has come to know that the said respondent company has been "struck off by ROC vide STK-7 dated 08.08.2018. As per the provisions of section 250 of Companies Act, 2013, despite "Strike Off of the respondent company under section 248 of the Companies Act, 2013, the company does not stand dissolved for the purpose of discharge of the liabilities or obligations of the company.

The "Strike Off status of the company is seriously affecting the validity of the assessment order and penalty proceedings. For validity of assessment order, recovery of demand and consequential penalty proceedings it is just and equitable and in public interest that the name of the respondent company be restored to the register of companies as if the name of the company had not been struck of.

The Income Tax Department is an aggrieved party within the meaning of section 252(1) of the Companies Act, 2013 if the name of the respondent company is not restored back, great prejudice will be caused to Revenue and public at large.

In view of the grounds raised by the Appellant which remain un-rebutted, their prayer merits consideration. The appeal is therefore allowed. The RoC is therefore directed to restore the name of Respondent 2 in its register and also proceed to take such other and further penal action against the respondents in accordance with the statutory provisions.