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Judgment
PER AMITABH SHUKLA, AM:
This appeal filed by the Assessee is directed against the order of Ld. Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre, New Delhi, dated 18.04.2024 arising out of assessment order dated 25.12.2019 passed under section 143(3)/147 for the Assessment Year 2012-13. The word 'Act' herein this order would mean Income Tax Act, 1961.
The Assessee has raised the following grounds of appeal:
1.BECAUSE, the impugned order dated 18.04.2024 passed by the Ld Commissioner of Income Tax (Appeals), NFAC under section 250 of the Act confirming the order passed by the Ld Assessing officer is bad in law as the same has not been passed in accordance with the provisions of section 250 (6) of the Act.
2.BECAUSE, the impugned order dated 18.04.2024 passed by the Ld Commissioner (Appeal), NFAC is bad in law as the same has been passed merely for “non prosecution”. Not even a single line has been mentioned on “merit” by the ld CIT (A).
3.BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT(A) has erred in law in confirming the order passed by the Ld AO ignoring the vital fact that the company was not in existence at the time of issue of statutory Notice under section 148 of the Act.
4.BECAUSE, upon the facts and in overall circumstances of the case ld CIT (A) erred in confirming the order passed by the Ld Assessing officer. The impugned order passed by the ld AO is patently illegal, bad in law and not legally enforceable as the said order was passed on a ‘dead company’.
WITHOUT PREJUDICE TO ABOVE
5.BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT(A) has erred in law and on facts in not giving any of its findings on merit of the case.
6.BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT(A) has erred in law and on facts in not giving any finding on unlawful addition of Rs. 11,75,00,000.00 made by the ld AO being the amount of Rs. 11,75,00,000.00 obtained by the Appellant from M/s Shail Investments Private Limited by issuing optionally fully convertible debentures.
7.BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT(A) has erred in law and on facts in not giving any finding on unlawful addition of Rs. 23,50,000.00 made by the ld AO being the alleged amount of commission paid on transaction of Rs. 11,75,00,000.00. The ld AO made an arbitrary addition without brining anything material on record.
The only issue arising in the appeal of the assessee, through it’s grounds, is its grievance of having been assessee in spite of the fact that the company was struck of from the register of ROC. The ld. Counsel for the assessee submitted that the assessment made is akin to making assessment in case of dead person, an act which has not been approved by several hon’ble Courts in their rulings. The ld. Counsel pointed out that the irony of the situation is that it repeatedly informed the ld. AO and the ld. CIT(A) of this fact, but the same was ignored and adverse order made in its case.
As per brief factual matrix of the case, order under section 143(3)/147 was passed by the ld. AO on 25.12.2019 making an addition of Rs.11,98,50,000/-. The assessee contested the order before the ld. CIT(A), who confirmed the impugned addition. Before us, the ld. Counsel has placed a paper book, inter alia, containing its replies given to the ld. AO and the ld. CIT(A), order of ROC dated 14.09.2018 by which the name of the company was struck off, judicial precedents reportedly supporting the appellant’s case of no assessment possible in case of struck off companies. It is the case of the assessee that upon passage of the order of ROC dated 14.09.2018 by which the name of the company was struck off, the assessee company was dissolved on 31.03.2019 and ceased to exist thereafter in the eyes of law.
Hear rival parties. Perused the material available on record.
We have noted that Hon’ble Apex Court in the case of Maruti Suzuki India in Civil Appeal No.5409 of 2018, while dealing with an identical issue have observed as under:-
“...upon the amalgamating company ceasing to exist, it cannot be regarded as a person under Section 2(31) of the Act 1961, against whom assessment proceedings can be initiated or an order of assessment passed. "In the present case, the notice under Section I43(2), by which jurisdiction was assumed by the Assessing Officer, was issued to a non-existent company. The assessment order was issued against the amalgamating company. This is a substantive illegality and not a procedural violation of the nature adverted to in Section 292B…"
We have further noted that a co-ordinate Bench of this Tribunal on identical facts in the case of Dazzle Developers in its order in ITA No.1360/Del/2025 dated 19.08.2025 have quashed, the notice issued under section 148 to a struck off company while holding assessment order has been passed without jurisdiction. In the impugned order, the Co-ordinate Bench relied upon the decision of the Hon’ble Delhi High Court in the case of Vivid Marketing Services Pvt. Ltd. We have noted that similar views have been held by various Hon’ble High Courts and the Tribunal.
Accordingly, in respectful compliance to the judicial precedents discussed hereinabove, we are of the considered view that no case of any assessment is possible in respect of company whose name is struck off from the register of ROC. Accordingly, we allow the appeal of the assessee.
In the result, the appeal of the assessee is allowed.