Income Tax Officer Ward 11(1) vs Registrar Of Companies And Ors.

This Appeal has been filed by Income tax Officer, Ward 11(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.H Squares Softech Co Pvt Ltd., in the register maintained by the Registrar of Companies, NCT of Delhi & Haryana.

As per the averments, M/s. H Squares Softech Co Pvt Ltd is a private limited company registered with Registrar of Companies, NCT of Delhi & Haryana on 18.02.2005 having its Registered office at Eros Corporate Tower ,15th Floor, Nehru Place, New Delhi - 110 019 and also at D-7, Ranjit Nagar Commercial Complex, New Delhi 110008 having CIN No.U72200DL2005PTC133151 and authorized share capital of the Company is Rs.5,00,000/- and paid up share capital of the Company is 1,00,000/-.

That directors of the Respondent No.2- company, being Mrs. Shalini Mahtani and Mr. Vijay Mahtani have been arrayed as Respondent No.3, Respondent no.4 respectively.

From the information available with the Revenue through NMS/ ITD software information from AIR Statements and individual transaction Statement (ITS), 26AS, it is observed that the respondent company has made foreign remittances amounting to Rs.53,34,577/- as reimbursement of expenses in foreign exchange during the F.Y. 2010-11 relevant to A.Y. 2011-12 and the respondent company did not file its ITR for A.Y. 2011-12.

As the respondent-company did not file its ITR and did not disclose fully and truly all material facts necessary for assessment, the Assessing officer has reason to believe that an estimated amount of atleast Rs.5,33,457/- (being 10% of the total remittance made during the year) has escaped assessment within the meaning of Section 147/148 opf the Income-tax Act and has not been brought under tax for the A.Y.2011-12, therefore, notice dated 27.03.2018 u/sec.148 of the Income-tax Act for the A.Y.2011-12 was issued to the respondent company.

The case of respondent-company had been re-opened u/sec.147 of the Income-tax Act for the A.Y.2011-12 for assessing the aforesaid undisclosed foreign remittances. The said proceedings for assessment of income of the respondent company for A.Y.2011-12 are pending and getting time barred by limitation on 1.12.2018.

As per Section 153(2) of the Income-tax Act, the Assessment Order has been passed on 24.12.2018 within the statutory time limit u/sec.147 r/w sec.144 of the Income -tax Act which resulted in creation of demand of Rs.3,21,436/- upon the respondent-company. As per Sec.153(2) of the Income-tax Act, the assessment has been passed on 18.09.2019 for A.Y. 2012-13 which resulted into creation of demand of Rs.1,48,150/-. As the respondent contravened me provisions of the income-tax Act, hence penalty proceedings u/sec.274 r/w sec.271F and 271(1)9c) were issued on 31.12.2019 and 11.03.2020.

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-5/2336 dated 13.06.2017 and subsequently struck off vide Notification No. ROC/DELHI/248(5)/STK-7/5071 dated 01.09.2017 at Sr.No.24945 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 clue and tor any turtner consequential proceedings against Me 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 23.02.2021.

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 0f the Registrar of Companies, as it 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.