ACIT, MUMBAI vs. JEWELEX INDIA PRIVATE LIMITED, MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL “F” BENCH, MUMBAI BEFORE SHRI ANIKESH BANERJEE, JUDICIAL MEMBER AND SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER ITA No. 7800/MUM/2025 Assessment Year: 2009-10 Assistant Commissioner of vs Jewelex India Private Limited Income Tax 401 Trade Centre, Room No.432, 4th Floor, Bandra Kurla Complex, Aayakar Bhavan, M.K. Road, Bandra East, Mumbai - 400020 Mumbai - 400098 (PAN: AABCJ4523H) Appellant Respondent Present for: Appellant by : Shri Nitesh Joshi, Advocate Shri P P Bhandari and Shri Ashwin Kashinath, CAs Respondent by : Ms. Kavitha Kaushik, Sr. DR Date of Hearing : 02.02.2026 Date of Pronouncement : 22.04.2026 O R D E R PER GIRISH AGRAWAL, ACCOUNTANT MEMBER This appeal filed by the Revenue is arising out of order of National Faceless Appeal Centre (NFAC), Delhi vide order no. ITBA/NFAC/S/250/2025-26/1080280541(1) dated 02.09.2025 against the assessment order passed by Dy. Commissioner of Income- tax -14(2)(1), Mumbai u/s 143(3) rws 147 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 31.12.2016 for A.Y. 2009-10. 2. Grounds taken by the Revenue are as under: I. Ground on Jurisdiction - Notice to Non-Existent Entity (Assessee's Ground 1)

ITA No.7800/Mum/2025 Jewelex India Pvt. Ltd. AY 2009-10 1. Whether, on the facts and in the circumstances of the case and in law, the Ld. Commissioner of Income-tax (Appeals) erred in holding the reassessment proceedings and the consequential order dated 31.12.2016 to be without jurisdiction and void merely because the notice under Section 148 of the Act was issued in the name of the merged entity, M/s Jewelex International Pvt. Ltd. 2. Whether, on the facts and in the circumstances of the case and in law, the Ld. CIT(A) ought to have appreciated that the successor-in-interest, M/s Jewelex India Pvt. Ltd. (the correct assessee), received the said notice, acknowledged it, filed objections, and actively participated throughout the reassessment proceedings, demonstrating full knowledge of the intended assessment. 3. Whether, on the facts and in the circumstances of the case and in law, the Ld. CIT(A) failed to apply the curative provision of Section 292B of the Income-tax Act, 1961, which validates any notice that is not invalid by reason of any mistake, defect, or omission, if the assessment is in substance and effect in conformity with the intent and purpose of the Act and the judicial precedents relied upon by the Ld. CIT(A) are factually distinguishable as they do not adequately cover cases where the correct successor entity participated fully. II. Ground on Procedural Defect - Non-Issue of Notice (Assessee's Ground 4) 4. Whether, on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in quashing the reassessment order on the ground of non- issuance of a fresh notice under Section 143(2) of the Act subsequent to the issue of notice under Section 148 of the Act. 5. Whether, on the facts and in the circumstances of the case and in law, the Ld. CIT(A) failed to consider the mandatory and overriding applicability of Section 292BB of the Act, which explicitly deems the non-service of any notice (including section 143(2)) as waived where the assessee has appeared in the proceedings without challenging the defect. 6. Whether, on the facts and in the circumstances of the case and in law, since the assessee actively participated by filing objections and appearing in the reassessment proceedings (as noted in the CIT(A)'s own order), the assessee is deemed to have waived the right to object to the non-service of the section 143(2) notice, and no prejudice was caused to the assessee.”

2.1. The two issues raised by the Revenue in its appeal are in respect of jurisdictional and procedural defects, in respect of the impugned reassessment proceedings carried out by the ld. AO for which relief has been granted by the ld. CIT(A).

ITA No.7800/Mum/2025 Jewelex India Pvt. Ltd. AY 2009-10 3. Brief facts of the case are that assessee filed its return of income on 23.09.2009, reporting total loss at Rs. 46,23,695/- under the normal provisions of the Act and book profit of Rs.5,99,03,753/- under the provisions of section 115JB of the Act. Originally, assessment was completed under section 143(3), vide order dated 19.12.2011 with total loss assessed at Rs. 39,56,291/- and book profit at Rs.5,99,03,753/-. Subsequently, case of the assessee was taken up for reassessment for which reassessment order was passed under section 147, read with 143(3), dated 31.01.2015 whereby the total loss was reassessed at Rs. 39,54,624/- and book profit at Rs.5,96,51,753/-. Again, for the second time, case of the assessee was reopened by invoking the provisions of section 147 for which the impugned reassessment order was passed whereby the total income was assessed at Rs. 6,09,68,740/-, by making disallowance under section 10B.

3.1. Before the ld. CIT(A), assessee raised its grounds on merits as well as contested on the jurisdictional issues relating to lack of jurisdiction and defect in the notice issued under section 148 as well as completion of the reassessment proceedings without issuing notice under section 143(2) as well as non-disposal of objections filed by the assessee by passing a speaking order. Ld. CIT(A) gave its findings in favour of the assessee on the two jurisdictional issues, one relating to notice under section 148 issued in the name of a non-existent entity on the date of issue of the said notice which had merged into another entity and on the second issue, in respect of non-issuance of notice under section 143(2), for making additions in the hands of the assessee to the total income/loss reported by it in its return filed in response to notice under section 148.

ITA No.7800/Mum/2025 Jewelex India Pvt. Ltd. AY 2009-10 3.2. Revenue is in appeal before the said relief by the ld. CIT(A). On the first issue relating to issue of notice under section 148 on non-existent entity, contention of the revenue is that the said entity got merged into another entity and had received the said notice, acknowledged it, filed objections and actively participated throughout the reassessment proceedings which demonstrates full knowledge of the intended assessment. According to the Revenue, the curative provision contained in section 292B ought to have been applied by the ld. CIT(A) while adjudicating on this issue, since the correct successor entity participated fully.

3.3. On the second issue relating to non-issue of notice under section 143 (2), contention of the Revenue is that ld. CIT(A) has not considered the mandatory and overriding provisions of section 292BB which explicitly deems the non-service of any notice including the relevant notice under section 143(2) as waived where the assessee has appeared in the proceedings without challenging the defect.

3.4. On the contrary, submissions of the ld. Counsel of the assessee are that in respect of the first issue, notice under section 148 was issued on 31.03.2016 in the name of Jewelex International Pvt. Ltd. which had already merged with Jewelex India Pvt. Ltd. by the order of Hon'ble Jurisdictional High Court of Bombay pursuant to the scheme of amalgamation dated 02.05.2014, copy of which is placed in the paper book. The said amalgamation was effective from 01.04.2013 and thus, the entity in whose name notice was issued was not in existence on the date of issue of the said notice. Ld. Counsel in this respect referred to the letter dated 25.04.2015 placed in the paper book which is addressed to DCIT, Range 3(2), Mumbai wherein all the details relating to amalgamation of Jewelex International Pvt. Ltd. with Jewelex India Pvt.

ITA No.7800/Mum/2025 Jewelex India Pvt. Ltd. AY 2009-10 Ltd. under the approved scheme of amalgamation was informed which is duly acknowledged by stamp dated 15.05.2015. In this communication, it is stated that Jewelex International Pvt. Ltd. ceased to exist with effect from 01.04.2013. Copy of the order of Hon'ble High Court of Bombay approving the scheme of amalgamation was furnished along with this letter. It is also stated that the amalgamation was given effect in financial year 2013-14 and the return of income was accordingly filed. Ld. Counsel also placed on record another letter dated 14.03.2014 which is issued from the office of DCIT-Range 3(2), Mumbai addressed to the Regional Director, Western Region, Ministry of Corporate Affairs, Mumbai, wherein the ld. DCIT has informed the Regional Director that there is no tax effect by the amalgamation and that his office had no objection for amalgamation of Jewelex International Pvt. Ltd. with Jewelex India Pvt. Ltd. Ld. Counsel thus, assertively stated that both these communications are much prior to the date of notice issued under section 148 which is 31.03.2016. Department was very much in the know-how of the amalgamation which had already undertaken effective from 01.04.2013 and had participated in the amalgamation proceedings by addressing to the Regional Director. Also, assessee had placed all the documentary evidences in respect of the amalgamation which had taken place much prior to the issue of notice under section 148. He placed reliance on the decision of Hon'ble Supreme Court in the case of Maruti Suzuki India Ltd. 107 taxmann.com 375 (SC) wherein it was held that proceedings initiated in the name of a non-existent entity are a nullity and not curable under section 292B of the Act.

3.5. On the second issue relating to procedural defect of not issuing notice under section 143(2), contention of the ld. Counsel is that the impugned reassessment order does not mention anywhere about the

ITA No.7800/Mum/2025 Jewelex India Pvt. Ltd. AY 2009-10 fact of notice having issued by the ld. AO under section 143(2). In the said impugned reassessment order, ld. AO has acknowledged filing of return by the assessee in response to notice issued under section 148. However, subsequent to this, there is no mention in respect of notice issued under section 143(2) though issuance of notice under section 142(1) is mentioned. Ld. Counsel placed reliance on the decision of Hon'ble Supreme Court in the case of ACIT vs. Hotel Blue Moon 188 taxmann.com 113 (SC), wherein it is held that issuance of notice under section 143(2) is a mandatory requirement and in the absence thereof assessment made would be invalid.

ITA No.7800/Mum/2025 Jewelex India Pvt. Ltd. AY 2009-10 the submissions of the appellant on 18.08.2025 which is part of the digital records on the portal. It was categorically intimated to the AO that since the appeal is 8 years old, this is the last opportunity being afforded to the AO for defending the jurisdiction as well as the merits of the case. However, no response was received from the assessing officer to any of these requisitions nor was any reasons explained or communicated. The assessing officer has, therefore, failed to furnish any evidence or supporting report regarding issuance of statutory notice under section 143(2). The appeal being very old cannot be kept pending indefinitely. Since almost 8 years have passed after filing the appeal and more than two and half years have passed after calling for the report/comments on the issues under reference, I am constrained to proceed on merits of the case in the interest of fairness and substantive justice.”

4.1. Ld. CIT(A) in para 5(ii) notes that no evidence has been submitted by the ld. AO in defence despite three specific opportunities having been provided to him. We find that even before us, ld. DR has not brought on record anything to support the contentions raised in the grounds of appeal filed by the Revenue.

4.2. Given factual position as stated above and duly examined by ld. CIT(A) by giving reasonable opportunity of being heard to the ld. Assessing Officer, we find that the notice under section 148 was issued on a non-existent entity which had got merged into another entity under the scheme of amalgamation much prior to the date of notice issued under section 148. The facts in this regard are undisputed and remains uncontroverted as nothing cogent has been brought on record by the Revenue to dislodge the same to disprove the same. In fact, Revenue has participated in the scheme of amalgamation by giving its no objection as to there being no tax effect by the said amalgamation. The curative provision of section 292B does not apply in the given set of facts as held by Hon'ble Supreme Court in the case of Maruti Suzuki India Ltd. (supra). Ld. CIT(A) has given his findings which are in consonance with the provisions of the Act and the judicial precedence. After taking into consideration the aforesaid factual matrix, we do not find any infirmity in the findings so arrived at by ld. CIT(A) in this

ITA No.7800/Mum/2025 Jewelex India Pvt. Ltd. AY 2009-10 regard. Accordingly, ground nos.1, 2 and 3 raised by the Revenue are dismissed.

5.1. Furthermore, we note from the decision of Hon'ble Supreme Court in the case of CIT vs. Lakshman Das Khandelwal [2019] 08 taxmann.com 183 (SC) wherein it is held that for section 292BB to apply, section 143(2) notice must have emanated from the Department and it is only infirmities in manner of service of notice that section seeks to cure and it is not intended to cure complete absence of notice itself. In the present case before us, there is nothing which demonstrates the existence of notice issued under section 143(2) and therefore, the decision in the case of Lakshman Das Khandelwal (supra) comes to the rescue of the assessee as nothing cogent is brought on record by the Revenue to uphold and justify the claim made by it in the grounds so raised. Accordingly, considering the aforesaid discussion, we do not find

ITA No.7800/Mum/2025 Jewelex India Pvt. Ltd. AY 2009-10 any infirmity in the findings arrived at by the ld. CIT(A) giving relief to the assessee. Grounds nos. 4, 5 and 6 raised by the Revenue are dismissed.

Order is pronounced in the open court on 22 April, 2026.

Sd/- Sd/- (Anikesh Banerjee) (Girish Agrawal) Judicial Member Accountant Member Dated: 22 April, 2026 MP, Sr.P.S Copy to : 1. The Appellant 2. The Respondent 3. DR, ITAT, Mumbai 4. Guard File 5. CIT

BY ORDER,

(Dy./Asst.Registrar) ITAT, Mumbai