DCIT-221, MUMBAI vs. STATE BANK OF INDIA, MUMBAI

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ITA 3718/MUM/2026Status: DisposedITAT Mumbai24 July 2026AY 2016-176 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that an assessment order passed against a non-existent entity is void ab initio. Following the principle of consistency and previous judgments, the Tribunal affirmed the CIT(A)'s decision.

What were the facts?

The Assessing Officer passed assessment orders against the State Bank of Hyderabad, which had been merged with the State Bank of India and ceased to exist. The assessee brought this fact to the notice of the CIT(A), who quashed the assessment orders.

What were the issues?

Whether an assessment order passed against a non-existent entity is void ab initio and whether Section 292B can cure such a defect.

Which sections of the Income-tax Act were involved?

Section 250(J),Section 292B

AI-generated summary — verify with the full judgment below

PER PAWAN SINGH, JUDICIAL MEMBER: 1. These two appeals by revenue are directed against the orders of ld. CIT(A)/NFAC both dated 28.01.2026 for Assessment Year (A.Y.) 2016-17 & 2017-18 respectively. In both the appeals, the revenue has raised similar ground of appeal; facts in both the years are almost similar except variation of figure of disallowances. In both the years, the ld. CIT(A) quashed the assessment order by taking view that assessment order passed against non- existing entity. Thus, both the appeals were taken together for hearing and are decided by common order to avoid conflicting decision. In appeal for A.Y. 2016-17, the revenue has raised following grounds of appeal:

State Bank of India ITA Nos. 3718 & 3719/Mum/2026 (AY: 2016-17 & 2017-18) “1. Whether on the facts and in the circumstances of the case and in law, the Hon'ble CIT(A) was justified in admitting an additional ground under section 250(J) of the Income-tax Act, 1961, when the omission to raise such ground earlier was wilful and unreasonable?

2.

Whether on the facts and in the circumstances of the case and in law, the Hon'ble CIT(A) erred in quashing the assessment order on a technical ground relating to the name of the entity, despite the assessee having participated in the assessment proceedings and no prejudice being caused? 3. Whether on the facts and in the circumstances of the case and in law, the Hon'ble CIT(A) was correct in holding the assessment order as void ab initio without appreciating the applicability of section 292B of the Income-tax Act, which protects proceedings from technical defects? 4. Whether on the facts and in the circumstances of the case and in law, the Hon'ble CIT{A) erred in relying upon the judgment of the Hon'ble Supreme Court in PCIT vs. Maruti Suzuki India Ltd. without considering the factual distinction and the timing of the said judgment vis-a-vis the assessment order?

5.

Whether on the facts and in the circumstances of the case and in law, the Hon'ble CIT(A) was justified in quashing the assessment order without adjudicating the issues on merits, thereby causing prejudice to the interests of the Revenue? 6. Whether on the facts and in the circumstances of the case and in law, the Hon'ble CIT(A) failed to appreciate that the assessee, having participated in the assessment proceedings and not having raised any objection at the appropriate stage including in the original grounds of appeal, is precluded from challenging the validity of the assessment at a belated stage? 7. The Appellant craves leave to add, amend, alter or withdraw any of the above grounds at the time of hearing.” 2. Rival submissions of both the parties have been heard and record perused. At the outset of hearing, the learned Authorised Representative (ld. AR) of the assessee submits that Assessing Officer (AO) passed assessment order

State Bank of India ITA Nos. 3718 & 3719/Mum/2026 (AY: 2016-17 & 2017-18) against non-existing entity. It is a matter of fact that Government of India notification vide its notification effective from 01.04.2017 merged State Bank of Hyderabad with State Bank of India. Such fact was brought in the notice of AO. Despite taking such fact on record, the AO passed assessment order on 03.10.2018 in the name of State Bank of Hyderabad that is non-existing entity. The assessee again brought this fact in the notice of ld. CIT(A) by filing additional ground of appeal. On the additional ground of appeal, the ld. CIT(A) obtained a remand report from AO. The ld. CIT(A) after considering the submission of assessee and various decision of Higher Courts and Hon’ble Apex Court in PCIT vs Maruti Suzuki India Ltd. 416 ITR 613 held that assessment order dated 03.10.2018 passed in the name of non-existing entity which is null and void and assessment order is void ab initio. Once the assessment order was quashed all the additions in the assessee were also stand deleted. The ld. AR of the assessee submits that on similar set of fact, Mumbai Tribunal in a series of decision including in case of State Bank of India (successor of State Bank of Indore in ITA No. 277to 280/Mum/2022 dated 20.09.2022, State Bank of India (successor of Bikaner and Jaipur) in ITA No. 2875/Mum/2019 dated 25.04.2022 & State Bank of India (successor of State bank of Travancore) in ITA No. 3476/Mum/2076/Mum/2019 quashed similar assessment order. The facts of present case are identical so far as

State Bank of India ITA Nos. 3718 & 3719/Mum/2026 (AY: 2016-17 & 2017-18) legal issue with regard to the quashing of assessment order against non- existing entity is concerned. 3. On the other hand, the learned Commissioner of Income Tax – Departmental Representative (ld. CIT-DR) for the Revenue supported the order of AO. The ld. CIT-DR submits that alleged erstwhile entity i.e. State Bank of Hyderabad duly participated and contested the assessment proceedings. No prejudiced is caused to the present appellant, who is successor in interest. 4. We have considered the rival submissions of both the parties and have gone through the orders of lower authorities carefully. We find that Government of India vide its Notification No. 128 dated 22.02.2017 merged various State Banks with State Bank of India including State Bank of Hyderabad. As per Government of India notification, State Bank of Hyderabad ceased to exist. We find that AO passed assessment order on 03.10.2018 despite informing him about merger of State Bank of Hyderabad with State Bank of India. We find that ld. CIT(A) quashed the assessment order after following various decisions of different High Courts and Apex Court in PCIT vs Maruti Suzuki India Ltd. (supra). We also find coordinate bench of Tribunal quashed similar assessment order in case of State Bank of India (successor of State Bank of Indore in ITA No. 277to 280/Mum/2022 dated 20.09.2022, State Bank of India (successor of Bikaner and Jaipur) in ITA No. 2875/Mum/2019 dated 25.04.2022 & State Bank of India (successor of State bank of Travancore) in

State Bank of India ITA Nos. 3718 & 3719/Mum/2026 (AY: 2016-17 & 2017-18) ITA No. 3476/Mum/2076/Mum/2019 apart from other similar cases that is in case of State Bank of Bikaner and Jaipur and State Bank of Indore, co- ordinate bench in similar case in ITA No. 3476/M/2019 in case of State Bank of India (successor of State Bank of Travancore). Thus, following the principle of consistency, we affirmed the order of ld. CIT(A). No contrary facts or law is brought to our notice to take other view. In the result, grounds of appeal of revenue are dismissed. ITA No. 3719/Mum/2026 (A.Y. 2017-18) 5. Considering the fact that revenue has raised similar grounds of appeal as raised in appeal for A.Y. 2016-17 wherein we have affirmed the order of ld. CIT(A) and dismissed the appeal of revenue. Therefore, following the principle of consistency, this appeal for A.Y. 2017-18 is also dismissed with similar observation. 6. In the result, both the appeals of the Revenue are dismissed. Order was pronounced in the open Court on 24/07/2026.

/- S/- Sd/- /- Sd/- Sd/- OM PRAKASH KANT PAWAN SINGH ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Dated:24/07/2026 Biswajit

State Bank of India ITA Nos. 3718 & 3719/Mum/2026 (AY: 2016-17 & 2017-18) Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Mumbai; and (5) Guard file.

By Order

Assistant Registrar ITAT, Mumbai

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