Income Tax Officer, Ward 1 (1) vs Registrar Of Companies And Ors.

This Appeal has been filed by Income tax Officer, Ward 1(1), New Delhi invoking the provisions of Section 252(1) of the Companies Act, 2013 for restoration of the name of the Respondents -Company M/s. Aargs Technology Private Limited in the register maintained by the Registrar of Companies, NCT of Delhi & Haryana.

As per the averments, M/s. Aargs Technology Pvt Ltd is a private limited company registered with Registrar of Companies, NCT of Delhi & Haryana on 06.08.2008 having its Registered office at 25/68, West Punjabi Bagh, New Delhi-110026 having CIN No.U72900DL2008PTC181772 and authorized and paid -up share capital of the Company is Rs.1,00,000/-.

That Directors of the Respondent No.2- company, being Mr. Mohammad Akram, Mr. Rama Kumar, Mr. Shivi Batra, Mr. Shubra Tiwari, Mr. Aranjna Ghai and Mr. Kiran Bishamber Lal have been arrayed as Respondent No.3 , Respondent no.4, Respondent no.5, Respondent no. 6 and Respondent no.7 respectively.

From the information available with the Revenue through NMS/ ITD Software, information from AIR/ CIB statements and Individual Transaction Statements (ITS) and 26AS, it is observed that during F.Y. 2011-12 relevant to A.Y. 2012- 13 , the respondent-company had received fee for Professional/ Technical services to the tune of Rs.56,98,978/-. As the respondent-company did not file ITR and did not disclose fully all material facts necessary for assessment, the Appellant has reason to believe that an estimated income of atleast Rs.3,49,489/- (being 50% fee of the Professional /Technical services) has escaped assessment within the meaning of Sec.147 of the Income-tax Act and has not been brought under tax for the A.Y. 2012-13.

Therefore, appellant issued notice dated 26.03.2017 u/sec.148 of the Income-tax Act for A.Y. 2012-13 asking the respondent-company to prepare a true and correct return of its income in respect of which it is assessable under Income-tax Act, 1961 during the previous year relevant to A.Y. 2012-13. The Assessment for the A.Y. 2012-13 in respect of respondent-company is still pending. Thus prime facie, there appears tax evasion which required action in accordance with the Law. Approval of the competent authority for re-opening of the assessment of respondent-company was obtained after recording reasons for re-opening. Assessment Order dated 09.11.2019 was passed U/s.144/147 of the Income-tax Act, 1961. Notice dated 09.11.2019 U/sec.174 r/w sec.271(1)(c) and Notice dated 09.11.2019 U/Sec.274 r/w Sec.271F of the Income-tax Act, 1961 was issued to the respondent-company.

Respondent -company failed to comply with the notices issued from time to time. The amount of Rs. 3,49,489/- was held as income of the respondent- company for the A.Y. 2012-13 i.e. 50% of fees for Professional/Technical Services of Rs 6,98,978/-. Therefore„ the total addition of Rs. 3,49,489/- was made as income of the assessee/ Respondent- company. The Assessing Officer was satisfied that respondent-company had concealed the particulars of its income, therefore, penalty proceedings u/s 271(1)(c) of the Act were initiated against the respondent-company and subsequently Demand Notice u/sec.156 of the Income-tax Act, 1961 was issued to Respondent company demanding tax of Rs.3,00,230/- .

To render the Assessment Order valid in the eyes of Law and to enable the Appellant take effective steps for recovery of taxes and for any further consequential proceedings the respondent company's name be restored to the Register of Companies as if the name of the Company was never struck off.

The respondent-company is trying to escape the Assessment proceedings and the liability that may arise out of the said proceedings.

On perusal of the MCA website, the appellant came to know that respondent- company was given notice by ROC vide No.ROC-DEL/248/STK-5/2018/721 dated 27.04.2017 and subsequently struck off vide Notification No. ROC/DELHI/248(5)/ STK-7/2879 dated 30.06.2017 at Sr.No.252 in terms of provision of Section 248(1) of the Companies Act, 2013 read with Rule 7 and Rule 9 of the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 by the ROC.

It is submitted by the appellant that the name of the respondent company had been struck off by the ROC without enquiry and the same was not intimated to the Appellant, Assessing Officer Income-tax or the concerned Commissioner of Income Tax. The same could not be allowed to be invoked resulting in escapement of tax liability or any other liability on the company which seeks to get its name removed from the register of the Ld. ROC.

The appellant submitted that the Income Tax department being aggrieved under the Section 252 of the companies Act, 2013 by the removal of the name of the company from the register by the registrar of the company as for the reopening of assessment proceedings the company has to be in existence for recovering the taxes due and for any further consequential proceedings against the respondent-company.

It is further submitted that since the respondent company has become non-existent entity, the respondent company and its directors are trying to escape the assessment proceedings and the liability that will arise out of the said proceedings.

The respondent-company failed to appear before the Court to provide its defence. Hence, the Order was reserved on 23.03.2021.

To render assessment order valid in the eyes of Law and to enable the Appellant to take steps for recovery of taxes and for any further consequential proceedings, the respondent- company's name be restored to the Register of Companies as if the name of the company was never struck off.

Denial to restore the name of the respondent company in the Register of the ROC will not only condone the wrong doing of the respondent company but it will also encourage of escapement of tax liabilities by such subterfuge which will be prejudicial to the interest of the revenue in the long run. The service of notice to respondents has been made through publication in newspaper, but none appeared.

Upon perusal of the documents and submissions made, this appeal is allowed. The Registrar of companies is directed to restore the name of the Respondent Company in their Register and also proceed to take such other and further penal action against the respondent in accordance with the statutory provisions. The name of the respondent Company shall then, as a consequence, stand restored to the Register of the Registrar of Companies, as if the name of the company had not been struck off in accordance with Section 248(1) of the Companies Act, 2013.

The appeal is allowed and disposed of accordingly.

Let the copy of the order be served to the parties.