ACIT- CC- 3(3), CR- 3, MUMB vs. M/S. CANDOR RENEWABLE ENERGY PVT. LTD.(ERSTWHILE 'BHADRAWATI ISPAT & ENERGY LTD'.), MUMBAI

आदेश / O R D E R Per Amit Shukla, Judicial Member: The aforesaid appeals as well as cross appeals have been filed by the revenue as well as assessee against impugned order of even date 29.10.2021, passed by Ld. CIT(A)-51, Mumbai for the quantum of assessment passed u/s 153A r.w.s. 143(3) for AY 2013-14 and 2014-15 respectively.

“Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) is justified in holding that the assessment order u/s 153A r.w.s. 143(3) of the Income Tax Act, 1961 is invalid without appreciating that the facts and circumstances of this case are distinguishable from Supreme Court judgment in the case of Pr. CIT, New Delhi Vs. Maruti Suzuki India Limited?”

3 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. 3. Whereas the assessee in both the appeals has raised the issue, firstly, on merits of the addition on account of unsecured loan added u/s 68; and secondly, the additions are not based on any incriminating materials found during the course of search, therefore the same are beyond the scope of assessment u/s 153A.

4 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. expired during the period between 15.03.2020 till 28.02.2022, all persons shall have a limitation period of 90 days from 01.03.2022.

5 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. carried out on the amalgamating company on 30.06.2017. However, notices u/s 153A dated 15.04.2019 were issued on the amalgamated company, i.e., M/s Bhadrawati Ispat & Energy Ltd. In response to the same, the appellant filed a letter dated 10.05.2019 wherein it was stated that M/s Bhadrawati Ispat & Energy Ltd. is already amalgamated with M/s Reliable Record Keepers Pvt. Ltd. (now known as Candor Renewable Energy Private Limited) and therefore, no return can be filed. The copy of the notice and letter has been placed in the paper book before us. However, the Ld. AO did not drop the proceedings. Accordingly the assessee submitted that it had to file the return without prejudice and to avoid any legal repercussions, filed the return of income u/s 153A on 22.06.2019 (in the name of erstwhile company as system would not accept the return in name of new company). It was without prejudice to its earlier claim which was intimated to the Ld. AO vide letter dated 24.06.2019. Further, the AO issued notice u/s 143(2) again in the name of non-existing company on 26.09.2019 and also issued notice u/s 142(1). Finally the assessment order has been passed in the name of non-existing entity which is as under:-

6 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. “M/s Bhadrawati Ispat & Energy Ltd. (merged with M/s. Reliable Record Keepers Pvt. Ltd. which is now known as M/s. Candor Renewable Energy Private Limited)” 8. This fact has also been captured by the Ld. CIT(A) in his order which for the sake of convenience, are reproduced hereunder:-

5.3 It is noted that a scheme of amalgamation was filed in Bombay High Court having an appointed date of 1.4.2015 wherein Bhadrawati Ispat & Energy Limited and Demand Trading India Limited, being amalgamating companies, sought to merge with Reliable Record Keepers Private limited, being the amalgamated company. The scheme was approved by the High Court vide their order dated 12th August 2016. With the approval of the scheme on 12.8.2016, the amalgamating companies ceased to exist. The search and seizure action was conducted on the assessee's premises on 30.6.2017 and notice under section 153A of the Act was issued on 23.5.2019. It has been claimed that in spite of the specific objection taken by the assessee that the entity Bhadrawati Ispat & Energy Limited did not exist right from the day of issue of notice u/s 153A of the Act, the AO has proceeded to issue all the statutory notices in the name of the non-existent entity and has also passed the final assessment order in the name of the non-existent company. As such, the assessee has claimed that the assessment order in the name of a non-existent company is void ab initio.

7 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. 5.4 In this regard, the various correspondence between the AO and the assessee has been examined. It is noted that the notice was issued on 15.4.2019 by the AO in the name of Bhadrawati Ispat & Energy Limited (now amalgamated with Candor Renewable Energy Renewable Energy Pvt. Limited). Vide letter dated 10.5.2019, the assessee has responded that: "With reference to the above and under the instructions from our above referred client, we would like to state that our client is in receipt of your honours notice u/s 153A of the Income Tax Act, 1961 dated 15.4.2019. In respect of the same, we would like to state that the above mentioned company is already merged vide High Court Order with M/s Candor Renewable Energy Private Limited (earlier known as Reliable Records Keepers Pvt Ltd.) and accordingly above mentioned assessee is no more in existence and therefore, no return can be filed u/s 153A of the IT Act, 1961." 5.5 Another communication has been addressed to the AO by the assessee on 24.6.2019 wherein the issue of company having merged with another company has been brought out and it has been clarified that the company does not exist anymore. The contents of the letter are reproduced below: "With reference to the above and under the instructions from our above referred client, we would like to state that our client is in receipt of your honours notice u/s 153A of the Income Tax Act, 1961 dated 15.4.2019. In respect of the same, we would

8 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. like to state that the above mentioned company is already merged vide High Court Order dated 20.11.2015 with M/s Candor Renewable Energy Private Limited and accordingly above mentioned assesses is no more in existence and therefore, no return can be filed u/s 153A of the ITAct, 1961. Without prejudice to the above, we would also like to state that in response to the notice received u/s 153A, the assesses has duly filed its return of income on 22.06.2019. Copy of ITR acknowledgement is enclosed herewith four your honours kind perusal and record." 5.6 There does not seem to be any acknowledgement from the AO on the above letters filed by the assessee. This is because the next notice, u/s 143(2) of the Act has been issued on 28.09.2019 once again in the name of Bhadrawati lspat & Energy Limited. A notice under section 142(1) of the Act has been issued by the AO on 14.12.2019 once again in the name of Bhadrawati lspat & Energy Limited (now merged with Candor Renewable Energy Private Limited). The final assessment order has been passed by the AO on 30.12.2019 and the demand notice has been issued again in the name of Bhadrawati Ispat & Energy Limited,(merged with Reliable Record Keepers Pvt Ltd which is now merged with Candor Renewable Energy Private Limited). 5.7 The assessee has vehemently argued that the assessment order, having been framed on a non-existent entity, was a nullity and hence, void ab initio. It has also been claimed that the

9 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. various notices issued in the name of the non-existent entity were illegal and bad in law. For this, the assessee has placed reliance on the decision of the Hon'ble Supreme Court in the case of Maruti Suzuki India Ltd. reported in 416 ITR 613 wherein the Hon'ble Court held that an order issued in the name of a non- existent company (amalgamating company) was a substantive illegality which was not curable under section 292B of the Act. 9. Thereafter, Ld. CIT(A) has discussed various judicial precedence and the judgments of Hon’ble Supreme Court in the case of Saraswati Industrial Syndicate Ltd. (1990) 53 Taxman 92 (SC); Spice Entertainment Ltd. vs. CIT (2012) 247 CTR 500; Sky Light Hospitality LLP (2018) 90 taxmann.com 413 (Delhi) and various other decision of Hon’ble High Court and finally he referred the judgment of Hon’ble Supreme Court in the case of PCIT vs. Maruti Suzuki India Ltd. reported in 413 ITR 613 and observed and held as under:-

5.28 The above decisions more or less settle the issue of error committed by the AO in issuing notice / assessment order in the name of non-existing corporate entities. There is a total unanimity with respect to fate of an assessment / order if it has been made on a non-existing corporate entity. The order is void or invalid. However, it is also seen that the Supreme Court in Maruti Suzuki

10 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. and the Delhi High Court in Skylight Hospitality, have recognized the clerical nature of certain errors. Other High Courts have also held that if the assessee itself does not inform the AO about the amalgamation and consequent fate of the company, provisions of section 292B can be resorted to save the order. The case of the assessee is analysed in light of these decisions. 5.29 It is noted that the AO was put to notice with respect to the amalgamation of Bhadrawati Ispat & Energy Limited with M/s Reliable Record Keepers Pvt Ltd. and subsequent amalgamation with Candor Renewable Energy Private Limited as the search was conducted after the amalgamation had been effected. The amalgamation happened w.e.f 1.4.2015 while the search took place on 30.6.2017 and the issue of amalgamation was in the knowledge of the Department during the search proceedings. It is also noted that the said fact was brought to the notice of the AO immediately on issue of notice under section 153A of the Act on 23.05.2019, wherein the assessee specifically took the plea that the notice had been issued in the name of an entity which did not exist and hence, no return could be filed by the said entity u/s 153A of the Act. In fact, in spite of reiteration of the above position by the assessee, the AO has proceeded to continue to issue notices in the name of the non-existent entity and has finally passed the assessment order in the name of the non- existent company. Passing of the assessment order in the name of the non-existent company has been unanimously held to be an illegality which cannot be condoned u/s.292B of the Act.

11 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. 5.30 In my view, the facts of the present case are identical with the facts in the case of Maruti Suzuki (supra). None of the ameliorating circumstances mentioned and taken note of by the various High Courts are present in this case. The AO has not proceeded to modify / correct the name on subsequent notices or the assessment order on receipt of specific information with reference to the scheme of amalgamation effected in the case. While dealing with the issue in the Maruti Suzuki case, the Hon'ble Supreme Court has elaborated on the binding nature? of its order by observing that: "26..........The law declared would attract the applicability of Article 141 of the Constitution. For, as this Court has held in Kunhayammed (supra): “40. Where the order rejecting an SLP is a speaking order, that is, where reasons have been assigned by this Court for rejecting the petition for special leave and are stated in the order still the order remains the one rejecting prayer for the grant of leave to appeal. The petitioner has been turned away at the threshold without having been allowed to enter in the appellate jurisdiction of this Court. Here also the doctrine of merger would not apply. But the law stated or declared by this Court in its order shall attract applicability of Article 141 of the Constitution. The reasons assigned by this Court in its order expressing its adjudication (expressly or by necessary implication) on point of fact or law shall take away the

12 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. jurisdiction of any other court, tribunal or authority to express any opinion in conflict with or in departure from the view taken by this Court because permitting to do so would be subversive of judicial discipline and an affront to the order of this Court. However this would be so not by reference to the doctrine of merger." 5.31 In light of the clear binding decision of Hon'ble Supreme Court on same facts, the assessment order passed by the AO in the name of an amalgamating company which was not in existence at the time of issue of notice is not found sustainable in eyes of law. The order is held to be invalid in eyes of law, having been framed in the name of a non-existent entity. The ground no. 1 raised by the assessee is allowed. 10. Before us, Ld. DR strongly referred and relied on the judgment of Hon’ble Supreme Court in the case of PCIT Vs. Mahagun Realtors (P) Ltd. (SLP No. 4063/2020), wherein the Hon’ble Apex Court has discussed the entire law including the judgment of Hon’ble Apex court in the case of Maruti Suzuki India Ltd. reported in 416 ITR 613 and other catena of judgments and has laid down the proposition of what is the meaning of amalgamation under the provisions of the Company’s Act and held that despite

13 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. amalgamation of business, enterprises and undertaking of transferee of amalgamated business which ceases to exist after amalgamation, is treated as continuing one and any benefits, by way of carried forward loss, etc. are allowed to the transferee. Unlike winding up, there is no end to the enterprise with the entity and the enterprise in the case of amalgamation continues. Thus, here in this case, the assessment pertains to A.Y. 2013-14 and 2014-15, when erstwhile company M/s Bhadrawati Ispat & Energy Ltd. was in existence and post search, the assessment which has been done and additions have been made and the demand has been raised upon the present assessee, therefore the assessment order is valid. He thus submitted that assessment cannot be quashed. In any case it was a mistake which is curable u/s 292BB.

14 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. 12. We have heard the rival submissions and perused the relevant findings given in the impugned order as well as material placed on record. In so far as the facts as discussed above, the same are not in dispute. Now the only question is, whether the entire assessment proceedings u/s 153A which was commenced after the date of search on 30.06.2017, when M/s Bhadrawati Ispat & Energy Ltd. had ceased to exist and was merged with M/s Reliable Record Keepers Pvt. Ltd. which has now known in the name of Candor Renewable Energy Private Limited, is valid or not. As noted above, by the order of Hon’ble Bombay High Court which approved the scheme of amalgamation, M/s Bhadrawati Ispat & Energy Ltd. stood merged with M/s Reliable Record Keepers Pvt. Ltd, the amalgamated company vide order dated 12th August 2016 with the appointed date of 01.04.2015. It is not in dispute that this fact was brought to the notice of the AO several times as noted by the Ld. CIT (A) also in his order including at the time of issuance of notice u/s 153A. Ld. AO despite that had issued all the statutory notices in the name of non-existing entity and finally has also passed the final assessment order in the name of non-existing company. Once the assessee had objected at the time of notice u/s

15 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. 153A that this company is no longer in existence and has already been merged by the order of Hon’ble Bombay High Court approving the scheme of amalgamation, then also he proceeded to frame assessment u/s 153A on entity which was no longer in existence. Once the aforesaid fact as noted by the Ld. CIT(A) which is also borne out from the records, then such proceeding u/s 153A as well as the entire assessment order passed for the AY 2013-14 and 2014-15 is void ab initio and invalid.

16 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. successor shall be assessed after the date of succession. The relevant section reads as under :-

"Succession to business otherwise than on death 170. (I) Where a person carrying on any business or profession (such person hereinafter in this section being referred to as the predecessor) has been succeeded therein by any other person (hereinafter in this section referred to as the successor) who continues to carry on that business or profession,— (a) the predecessor shall be assessed in respect of the income of the previous year in which the succession took place up to the date of succession. (b) the successor shall be assessed in respect of the income of the previous year after the date of succession. (2) Notwithstanding anything contained in sub-section (1), when the predecessor cannot be found, the assessment of the income of the previous year in which the succession took place up to the date of succession and of the previous year preceding that year shall be made on the successor in like manner and to the same extent as it would have been made on the predecessor, and all the provisions of this Act shall, so far as may be, apply accordingly..." 15. Thus, Section 170 specifically provides that if a person carrying on a business is succeeded by another person, then the

17 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. predecessor shall be liable for assessment till the date of succession and successor shall be assessed in respect of the income after the date of succession. Section 170(2) starts with a non-obstante clause which provides that in case if the predecessor in case of succession is not found then the successor shall be assessed in the place of predecessor for the year of succession and previous year to the year of succession.

18 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. - Reorganisation, reconstruction and amalgamation of companies are governed under the provisions of Companies Act (i.e., section 394 of Companies Act 1956 / section 232 of Companies Act, 2013). - As per the provisions of Companies Act, once the scheme of amalgamation is approved by the relevant Court/ Tribunal, the same results in mandatory dissolution of the amalgamating transferor company without winding-up. - Meaning thereby that pursuant to the amalgamation being effective, the amalgamating entity ceases to exist in the eyes of the law. - Further, Section 481 of the Companies Act, 1956 dealt with the dissolution of a company. The effect of dissolution of a company is that the company no longer survives and effectively, dies. - The effect of amalgamation of two companies was analysed by the Hon*ble Apex Court in the case of General Radio & Appliances Co. Ltd. v. M.A. Khader [1986] 2 SCO 656.  In the facts of that case, General Radio & Appliances Co. Ltd. was amalgamated with National Ekco Radio & Engg. Co. Ltd. under a scheme of amalgamation and order of the High Court under sections 391 and 394. Under the amalgamation scheme, the transferee company, namely, National Ekco Radio 85 Engg. Co. Ltd. had acquired all the interest, rights including leasehold

19 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. and tenancy rights of the transferor company and the same vested in the transferee company.  Pursuant to the amalgamation scheme the transferee company continued to occupy the premises which had been let out to the transferor company. The landlord initiated proceedings for the eviction on the ground of unauthorized sub-letting of the premises by the transferor company. The transferee company set up a defense that by amalgamation of the two companies under the order of the Bombay High Court all interest, rights including leasehold and tenancy rights held by the transferor company blended with the transferee company, therefore, the transferee company was legal tenant and there was no question of any sub-letting.  The Hon'ble Apex Court held that under the order of amalgamation made on the basis of the High Court's order, the transferor company ceased to be in existence in the eye of law and it effected itself for all practical purposes. United Kingdom Court in the case of M.H. Smith (Plant Hire) Ltd. Vs. D.L. Mainwaring (T/A Inshore), 1986 BCLC 342 (CA), in the context of dissolution of a company that "once a company is dissolved it becomes a nonexistent party and therefore no action can be brought in its name. Thus an insurance company which was subrogated to the rights of another insured company was held not to be entitled to

20 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. maintain an action in the name of the company after the latter had been dissolved”.

 On September 28, 1962, under the orders of the High Court, the Indian Sugar Company was amalgamated with the appellant- company. Prior to the amalgamation, the Indian Sugar Company had been allowed expenditure to the extent of Rs. 58,735 on accrual basis in its earlier assessment. The said trading liability was taken over by the appellant company. After amalgamation, the appellant-company claimed exemption of the amount of Rs. 58,735 from income-tax for the assessment year 1965-66 on the ground that the amalgamated company was not liable to pay tax under section 41(1) of the Income-tax Act, 1961 , as the

21 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. expenditure had been allowed to the erstwhile Indian Sugar Company which was a different entity from the amalgamated company. The Income-tax Officer disallowed the appellant's claim for exemption.  The assessee filed an appeal before the Appellate Assistant Commissioner who confirmed the order of the Income-tax Officer. The assessee, thereafter, preferred an appeal before the Income- tax Appellate Tribunal. The Tribunal allowed the appeal on the construction of section 41(1) of the Act. The Tribunal held that, after the amalgamation of the Indian Sugar Company with the assessee-company, the identity of the amalgamating company was lost and it was no longer in existence and therefore, the assessee-company was a different entity not liable to tax on the aforesaid amount of Rs. 58,735. On the Department's application, the Tribunal referred the matter to High Court.  The High Court answered the question in favour of the Revenue holding that the exemption from tax liability claimed by the appellant-assessee was chargeable to tax under section 41(1) of the Act. The High Court held that, on the amalgamation of the two companies, neither of them ceased to exist; instead both the amalgamating and amalgamated companies continued their entities in a blended form. It further held that the amalgamated company was a successor-in-interest of the amalgamating company and since the assets of both the companies were merged and blended to constitute a new company, the liabilities attaching thereto must, therefore, be on the amalgamated company. On

22 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. these findings, the High Court held that the amalgamated company, namely, the assessee, was liable to pay tax on Rs. 58,735.  The Apex court considered the question whether, on the amalgamation of the Indian Sugar Company with the appellant- company, the Indian Sugar Company continued to have its identity and was alive for the purposes of section 41(1) of the Act. The Apex court observed as under :- "Generally, where only one company is involved in a change and the rights of the shareholders and creditors are varied, it amounts to reconstruction or reorganization or scheme of arrangement In an amalgamation, two or more companies are fused into one by merger or by one over the other. Reconstruction or amalgamation has no precise legal meaning. Amalgamation is a blending of two or more existing undertakings into one undertaking, the shareholders of each blending company become substantially the shareholders in the company which is to carry on the blended undertakings. There may be amalgamation either by the transfer of two or more undertakings to a new company, or by the transfer of one or more undertakings to an existing company. Strictly, "amalgamation" does not cover the mere acquisition by a company of the share capital of the other company which remains in existence and continues its undertaking but the context in which the term is used may show that it is intended to include such an acquisition. See Halsbury's

23 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. Laws of England, 4th Edition, Volume 7, para. 1539. Two companies may join to form new company, but there may be absorption or blending of one by the other and both amount to amalgamation. When two companies are merged and are so joined as to form a third company or one is absorbed into the other or blended with another, the amalgamating company loses its entity."

The Apex court further observed: "The Tribunal rightly held that the appellant-company was a separate entity and a different assessee and, therefore, the allowance made to Indian Sugar Company which was a different assessee could not be held to be the income of the amalgamated company for purposes of section 41(1) of the Act. The High Court's view that, on amalgamation, there is no complete destruction of the corporate personality of the transferor- company but instead there is a blending of the corporate personality of one with another corporate body and it continues as such with the other is not sustainable in law. The true effect and character of the amalgamation largely depends on the terms of the scheme of merger. But there cannot be any doubt that, when two companies amalgamate and merge into one, the transferor-company loses its entity as it ceases to have its business. However, their respective rights and liabilities are determined under the scheme of amalgamation but the corporate

24 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. entity of the transferor-company ceases to exist with effect from the date the amalgamation is made effective."

The afore-mentioned observations of the Apex Court support the view that after the amalgamation, the amalgamating company loses its identity and cannot be assessed as per the provisions of the Income Tax act, 1961.

Spice Entertainment Ltd vs. CST 2012 (280) ELT 43 (Del) [affirmed by SC] 19. Thereafter, the Division bench of Delhi High Court in the case of Spice dealt with the question as to whether an assessment in the name of an amalgamating company which has been amalgamated and has been dissolved is null and void or whether the framing of an assessment in the name of such company is merely a procedural defect which can be cured. The Hon’ble Delhi High Court held as follows:

(a) Spice (amalgamating company) got amalgamated with MCorp Put Ltd. It was the result of the scheme of the amalgamation filed before the Company Judge of Delhi High Court which was duly sanctioned vide orders dated llthFebruary, 2004. With

25 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. amalgamation made effective from 1st July, 2003, Spice ceased to exist. That is the plain and simple effect in law. (b) The scheme of amalgamation itself provided for this consequence, inasmuch as simultaneous with the sanctioning of the scheme, Spice also stood dissolved by specific order of Delhi High Court. With the dissolution of the amalgamating company, its name was struck off from the rolls of Companies maintained by the Registrar of Companies. (c) A company incorporated under the Indian Companies Act is a juristic person. It takes its birth and gets life with the incorporation. It dies with the dissolution as per the provisions of the Companies Act. It is trite law that on amalgamation, the amalgamating company ceases to exist in the eyes of law by relying on the judgment of Apex Court in Saraswati Industrial Syndicate (Supra) and General Radio and Appliances (Supra). (d) Section 481 of the Companies Act provides for dissolution of the company. The High Court can order dissolution of a company on the grounds stated in section 481 of the Companies Act. The effect of the dissolution is that the company no more survives. The dissolution puts an end to the existence of the company. Court relied upon the judgment of M.H. Smith (Plant Hire) Ltd. Vs. D.L. Mainwaring (T/A Inshore) (Supra). (e) The amalgamated company had brought the fact of the amalgamation to the notice of the assessing officer. Despite this, the assessing officer did not substitute the

26 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. name of the amalgamated company and proceeded to make an assessment in the name of a non-existent company which renders it void. (f) This, it was held was not merely a procedural defect and it was held that participation by the amalgamated company would have no effect since there could be no estoppel against law.

27 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd.  The issue whether notice issued/ assessment framed against an amalgamating/ non-existent entity post amalgamation is valid was decided by the Hon'ble Supreme Court in the landmark judgment of Maruti Suzuki (Supra). The facts of the said case were as follows: a) Assessee - Suzuki Power-train India Limited (SPIL), was a joint venture between Suzuki Motor Corporation (SMC) and Maruti Suzuki India Ltd (MSIL). b) SPIL filed return declaring certain taxable income, which was processed u/s 143(1). c) Subsequently, SPIL (Amalgamating Company) was amalgamated with 'MSIL' (Amalgamated Company) with effect from 1-4-2012 under Court orders on 29.01.2013. d) MSIL intimated to the AO on 2.04.2013. e) Notice under section 143(2) dated 26.09.2013 was issued to SPIL, non-existent entity. f) Thereafter, MSIL participated in assessment proceedings of SPIL. g) The assessment order under section 143(3), read with section 144C (1) of the Act was passed in the name of "SPIL (amalgamated with MSIL)".  The assessee argued before the tax/ appellate authorities that an assessment order passed in the name of a non-existent entity was void ab initio, since after amalgamation, the amalgamating company ceases to exist. Tax Department was of

28 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. the view that since name of both the entities were mentioned in the order, the assessment order cannot be declared as invalid.  Before the Apex Court, the main contentions of the Revenue were as follows: (a) Names of both amalgamating and amalgamated company was mentioned in the assessment order; (b) Even otherwise, the mistake is curable u/s 292B (c) Assessment and subsequently appeal was represented by Amalgamated company and no prejudice is caused to the parties; (d) In Spice, the final order only referred to the name of nonexistent entity without any reference to the amalgamated company; (e) Even as per decision in Spice, if the order is passed on the resulting company the same shall not be void - hence in present case since both the names were mentioned it cannot be regarded as a jurisdictional defect; (f) Draft assessment order and the final assessment order referred to both the names; (g) In case of Spice, doctrine of merger with the judgment of SC shall not apply.

 The main contentions of the Assessee were as follows: a) Upon a scheme of amalgamation being sanctioned, the amalgamated company is dissolved without winding up,

29 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. in terms of Section 394 of the Companies Act 1956. The amalgamating company ceases to exist in the eyes of law; b) The amalgamating company cannot thereafter be regarded as a "person" in terms of Section 2(31) of the Act against whom assessment proceedings can be initiated and an assessment order passed by relying on Saraswati Industrial Syndicate Ltd. vs. CIT [1990] 186 ITR 278 (SC); c) The jurisdictional notice under Section 143(2) of the Act, pursuant to which the assessing officer assumed jurisdiction to make an assessment was issued in the name of SPIL, a non-existent entity and was invalid. Hence the initiation of assessment proceedings against a non-existent entity was void ab initio. d) Reliance was placed on CIT vs. Intel Technology India (P.) Ltd. [2016] 380 ITR 272 (Kar.), Pr. CIT vs. Nokia Solutions & Network India (P.) Ltd. 402 ITR 21 (Delhi), Spice Entertainment (supra), BDR Builders & Developers (P.) Ltd. vs. Asstt. CIT 397 ITR 529 (Delhi), Rustagi Engineering Udyog (P.) Ltd. vs. Dy. CIT 382ITR 443 (Delhi), Khurana Engineering Ltd. vs. Dy. CIT [2014] 364 ITR 600 (Guj), Takshashila Realties (P.) Ltd. vs. Dy. CIT [2017] 77 taxmann.com 160 (Guj.), Alamelu Veerappan vs. ITO 257 Taxman 72 (Mad.).

30 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. e) The order passed by the TPO in the name of SPIL, a nonexistent entity was invalid in the eyes of the law; f) SPIL ceased to be an "eligible assessee", in terms of section 144C(15) (b) of the Act. Consequently, there was no requirement to pass a draft assessment order/reference to DRPetc.; g) The final assessment order dated 31 October 2016 is beyond limitation in terms of Section 153(1) read with Section 153 (4) of the Act. h) The assessment framed in the name of the amalgamating Company is invalid [refer: Spice Entertainment vs. CIT, CIT v. Dimension Apparels (P.) Ltd. [2015] 370 ITR 288 (Delhi); affirmed by Hon'ble Apex Court vide Civil Appeal No. 3125 of 2015, CIT v. Micron Steels (P.) Ltd. 372 ITR 386 (Delhi), CIT v. Micra India (P) Ltd. 231 Taxman 809 (Delhi)]. i) Assessment framed in the case of a non-existent entity is non-est in the eyes of law [refer: Pr. CIT vs. BMA Capfin Ltd. [2018] 100 taxmann.com 329 (Delhi) (Revenue's SLP dismissed against the same in Pr. CIT vs. BMA Capfin Ltd. [2018] 100 taxmann.com 330/[2019] 260 Taxman 89 (SC)]

 The Apex Court after taking into consideration submissions of both sides held as follows:

31 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd.

a) Under the approved scheme of amalgamation, the transferee assumed the liabilities of the transferor company, including tax liabilities; b) The consequence of the scheme of amalgamation approved under Section 394 of the Companies Act 1956 is that the amalgamating company ceased to exist by relying on the judgment of Saraswati Industrial Syndicate Ltd vs. CIT (Supra). c) Upon the amalgamating company ceasing to exist, it cannot be regarded as a person under Section 2(31) of the Act against whom assessment proceedings can be initiated or an order of assessment passed; d) Prior to the date on which the jurisdictional notice under Section 143(2) was issued, the scheme of amalgamation had been approved on 29th January 2013 by the High Court of Delhi under the Companies Act 1956 with effect from 1 April 2012; e) Assessing officer assumed jurisdiction to make an assessment in pursuance of the notice under Section 143(2). The notice was issued in the name of the amalgamating company inspite of the fact that on 2nd April 2013, the amalgamated company MSIL had addressed a communication to the assessing officer intimating the fact of amalgamation.

32 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. f) Initiation of assessment proceedings against an entity which had ceased to exist was void ab initio. g) The basis on which jurisdiction was invoked was fundamentally at odds with the legal principle that the amalgamating entity ceases to exist upon the approved scheme of amalgamation. h) Participation in the proceedings by MSIL in the circumstances cannot operate as an estoppel against law. 23. Subsequently, various Court/Tribunals followed the law laid down by the Hon’ble Apex Court in Maruti Suzuki Ltd (Supra) and quashed the assessments framed in the name of non-existent entities.

PCIT vs. Mahagun Realtors Pvt Ltd (Supra) – Analysis 24. The Hon’ble Apex Court in the recent case of PCIT vs. Mahagun Realtors Pvt Ltd (MRPL) has, in peculiar facts, held the assessment proceedings initiated and concluded in the name of non-existent entity (amalgamating entity), to be valid. The apex Court distinguished (and not disagreed) its earlier judgment in the case of Maruti Suzuki Ltd (Supra).

33 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd.

The relevant facts of the case are as under:- i. The original return of MRPL was filed under Section 139(1) on 30.06.2006. ii. The order of amalgamation was dated 11.05.2007 - but made effective from 01.04.2006. It contained a condition - Clause 220-whereby MRPL's liabilities devolved on MIPL. iii. The original return of income was not revised even though the assessment proceedings were pending. The last date for filing the revised return was 31.03.2008, after the amalgamation order came into operation. iv. A search and seizure proceeding was conducted in respect of the Mahagun group, including the MRPL and other companies. v. When search and seizure of the Mahagun group took place, no indication was given about the amalgamation. vi. A statement made on 20.03.2007 by Mr. Amit Jain, MRPL's managing director, during statutory survey proceedings under Section 133A, unearthed discrepancies in the books of account, in relation to amounts of money in MRPL's account. The specific amount admitted was 5.072 crores, in the course of the statement recorded. vii. The warrant was in the name of MRPL. The directors of MRPL and MIPL made a combined statement under Section 132 of the Act, on 27.08.2008.

34 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. viii. A total of Rs. 30 crores cash, which was seized- was surrendered in relation to MRPL and other transferor companies, as well as MIPL, on 27.08.2008 in the course of the search operation, when a statement of Mr. Amit Jain was recorded under Section 132 (4) of the Act. ix. Upon being issued with a notice to file returns, a return was filed in the name of MRPL on 28.05.2010. Before that, on two dates, i.e., 22/27.07.2010, letters were written on behalf of MRPL, intimating about the amalgamation, but this was for AY 2007-08 (for which separate proceedings had been initiated under Section 153A) and not for AY 2006-07. x. The return specifically suppressed - and did not disclose the amalgamation (with MIPL) - as the response to Query 27(b) was "N.A". xi. The return - apart from specifically being furnished in the name of MRPL, also contained its PAN number. xii. During the assessment proceedings, there was full participation -on behalf of all transferor companies, and MIPL. A special audit was directed (which is possible only after issuing notice under Section 142). Objections to the special audit were filed in respect of portions relatable to MRPL. xiii. After fully participating in the proceedings which were specifically in respect of the business of the erstwhile MRPL for the year ending 31.03.2006, in the cross-

35 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. objection before the ITAT, for the first time (in the appeal preferred by the Revenue), an additional ground was urged that the assessment order was a nullity because MRPL was not in existence. xiv. Assessment order was issued - undoubtedly in the name of MRPL (shown as the assessee, but represented by the transferee company MIPL). xv. Appeals were filed to the CIT (and a cross-objection, to ITAT) - by MRPL "represented by MIPL". xvi. At no point in time - the earliest being at the time of search, and subsequently, on receipt of notice, was it plainly stated that MRPL was not in existence, and its business assets and liabilities, taken over by MIPL. xvii. The counter affidavit filed before this court - (dated 07.11.2020) has been affirmed by Shri Amit Jain S/o Shri P.K. Jain, who- is described in the affidavit as "Director of M/S Mahagun Realtors(P) Ltd., R/o...".

FINDINGS OF THE COURT i. Amalgamation is not like the winding up of a corporate entity. In the case of amalgamation, the outer shell of the corporate entity is undoubtedly destroyed; it ceases to exist. Yet, in every other sense of the term, the corporate venture continues - enfolded within the new or the existing transferee entity.

36 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. ii. In other words, the business and the adventure lives on but within a new corporate residence, i.e., the transferee company. It is, therefore, essential to look beyond the mere concept of destruction of corporate entity which brings to an end or terminates any assessment proceedings. There are analogies in civil law and procedure where upon amalgamation, the cause of action or the complaint does not per se cease - depending of course, upon the structure and objective of enactment. Broadly, the quest of legal systems and courts has been to locate if a successor or representative exists in relation to the particular cause or action, upon whom the assets might have devolved or upon whom the liability in the event it is adjudicated, would fall. iii. The combined effect, therefore, of Section 394 (2) of the Companies Act, 1956, Section 2 (1A) and various other provisions of the Income Tax Act, is that despite amalgamation, the business, enterprise and undertaking of the transferee or amalgamated company- which ceases to exist, after amalgamation, is treated as a continuing one, and any benefits, by way of carry forward of losses (of the transferor company), depreciation, etc., are allowed to the transferee. Therefore, unlike a winding up, there is no end to the enterprise, with the entity. The enterprise in the case of amalgamation, continues.

37 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. iv. There is no doubt that MRPL amalgamated with MIPL had ceased to exist thereafter; this is an established fact and not in contention. The respondent has relied upon Spice and Maruti Suzuki (supra) to contend that the notice issued in the name of the amalgamating company is void and illegal. The facts of present case, however, can be distinguished from the facts in Spice and Maruti Suzuki. v. Firstly, in both the relied upon cases, the assessee had duly informed the authorities about the merger of companies and yet the assessment order was passed in the name of amalgamating/non-existent company. However, in the present case, for AY 2006-07, there was no intimation by the assessee regarding amalgamation of the company. The ROI for the AY 2006-07 first filed by the respondent on 30.06.2006 was in the name of MRPL. MRPL amalgamated with MIPL on 11.05.2007, w.e.f. 01.04.2006. In the present case, the proceedings against MRPL started on 27.08.2008-when search and seizure was first conducted on the Mahagun group of companies. Notices under Section 153A and Section 143(2) were issued in the name MRPL and the representative from MRPL corresponded with the department in the name of MRPL. On 28.05.2010, the assessee filed its ROI in the name of MRPL, and in the 'Business Reorganization' column of the form mentioned 'not applicable' in amalgamation section. Though the respondent contends

38 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. that they had intimated the authorities by letter dated 22.07.2010, it was for AY 2007-2008 and not for AY 2006-07. For the AY 2007-08 to 2008-2009, separate proceedings under Section 153A were initiated against MIPL and the proceedings against MRPL for these two assessment years were quashed by the Additional CIT by order dated 30.11.2010 as the amalgamation was disclosed. In addition, in the present case the assessment order dated 11.08.2011 mentions the name of both the amalgamating (MRPL) and amalgamated (MIPL) companies. vi. Secondly, in the cases relied upon, the amalgamated companies had participated in the proceedings before the department and the courts held that the participation by the amalgamated company will not be regarded as estoppel. However, in the present case, the participation in proceedings was by MRPL which held out itself as MRPL. vii. What is overwhelmingly evident- is that the amalgamation was known to the assessee, even at the stage when the search and seizure operations took place, as well as statements were recorded by the revenue of the directors and managing director of the group. A return was filed, pursuant to notice, which suppressed the fact of amalgamation; on the contrary, the return was of MRPL. Though that entity ceased to be in existence, in law, yet, appeals were filed on its behalf before the CIT, and a cross

39 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. appeal was filed before ITAT. Even the affidavit before this court is on behalf of the director of MRPL. Furthermore, the assessment order painstakingly attributes specific amounts surrendered by MRPL, and after considering the special auditor's report, brings specific amounts to tax, in the search assessment order. That order is no doubt expressed to be of MRPL (as the assessee) - but represented by the transferee, MIPL. All these clearly indicate that the order adopted a particular method of expressing the tax liability. The AO, on the other hand, had the option of making a common order, with MIPL as the assessee, but containing separate parts, relating to the different transferor companies (Mahagun Developers Ltd., Mahagun Realtors Pvt. Ltd., Universal Advertising Pvt. Ltd., ADR Home Decor Pvt. Ltd.). viii. The mere choice of the AO in issuing a separate order in respect of MRPL, in these circumstances, cannot nullify it. Right from the time it was issued, and at all stages of various proceedings, the parties concerned (i.e., MIPL) treated it to be in respect of the transferee company (MIPL) by virtue of the amalgamation order -and Section 394 (2). Furthermore, it would be anybody's guess, if any refund were due, as to whether MIPL would then say that it is not entitled to it, because the refund order would be issued in favour of a non-existing company (MRPL). Having regard to all these reasons, this court is of the

40 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. opinion that in the facts of this case, the conduct of the assessee, commencing from the date the search took place, and before all forums, reflects that it consistently held itself out as the assessee. The approach and order of the AO is, in this court's opinion in consonance with the decision in Marshall & Sons. ix. This Court notes and holds that whether corporate death of an entity upon amalgamation per se invalidates an assessment order ordinarily cannot be determined on a bare application of Section 481 of the Companies Act, 1956 (and its equivalent in the 2013 Act), but would depend on the terms of the amalgamation and the facts of each case.

41 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. Revenue, additional ground was urged that the assessment order was nullity because MRPL was not in existence. The assessment order was issued in the name of MRPL (representative of MIPL) and even in the first appeal before the Id. CIT (A) and cross objection before the ITAT, it was mentioned as "MRPL represented by MIPL". At no point of time, even at the time of search and subsequently on receipt of the notice, it was stated that MRPL was not in existence and its business of the erstwhile MRPL was taken over by MIPL. Even in the counter affidavit filed before the Hon'ble Apex Court, it has been affirmed by Shri Amit Jain, who has been described in the affidavit as Director of M/s. Mahagun Realtors (P) Ltd.. It was in this background, the Hon'ble Court in para 33 observed as under -

"33. There is no doubt that MRPL amalgamated with MIPL and ceased to exist thereafter; this is an established fact and not in contention. The respondent has relied upon Spice and Maruti Suzuki (supra) to contend that the notice issued in the name of the amalgamating company is void and illegal. The facts of present case, however, can be distinguished from the facts in Spice and Maruti Suzuki on the following bases."

42 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. 26. Therefore, the Supreme Court merely distinguished the facts in Spice and Maruti, while continuing to agree with the fundamental principle that on amalgamation, the amalgamating entity ceases to exist. Thereafter, the Court in paras 34 onwards, held as under:

a) No intimation was given to the AO for A.Y 2006-07 [refer para 34]; b) Return filed, pursuant to notice, suppressed the fact of amalgamation. The return was filed in the name of MRPL. Further in Business Reorganization' column it was mentioned "not applicable" [refer para 34, 40]. c) Name of both the companies were mentioned in the order [refer para 34]; d) Assessee before authorities held itself out to be as MRPL [refer para 35]; e) Substantial surrender in survey and search on behalf of MRPL [refer paras 37-38]; f) Facts of present case distinctive [refer para 40]; g) The fact of amalgamation being known to the assessee, even at the stage when the search and seizure operations took place, as well as when statements were recorded of the directors and managing director of the group, was not communicated to the income tax authorities [refer paras 40- 41].

43 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. h) Even when MRPL ceased to be in existence, in law, yet appeals were filed on its behalf before the CIT, and a cross appeal was filed before ITAT. Even the affidavit before Apex Court was on behalf of the director of MRPL . i) The assessment order was no doubt expressed to be of MRPL (as the assessee) - but represented by the transferee, MIPL. All these clearly indicate that the order adopted a particular method of expressing the tax liability. j) Merely because instead of passing a common order for MIPL as the assessee, a separate order in respect of MRPL is passed, cannot nullify the assessment order. k) Right from the time it was issued, and at all stages of various proceedings, the parties concerned (i.e., MIPL) treated it to be in respect of the transferee company (MIPL) by virtue of the amalgamation order and Section 394 (2). 1) Having regard to all these reasons, the Apex Court was of the opinion that in the facts of the case, the conduct of the assessee, commencing from the date the search took place, and before all forums, reflects that it consistently held itself out as the assessee. Thus, the assessment order passed in the name of MRPL was held to be valid.

44 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. 27. Further, the Court distinguished the judgments passed in the case of Maruti Suzuki (Supra) and Spice on the following grounds:

a) The legislative amendment by way of introduction of section 2(1A), defining "amalgamation", was not taken into account by the Apex Court in earlier decisions. Further, the tax treatment in case of amalgamation under various provisions (such as in section 72A, 80IA, etc.) of the Act were not brought to the notice of the Apex Court, in the earlier decisions; b) In the relied upon cases, the assessee had duly informed the tax authorities about the fact of the merger of companies and yet the assessment order was passed in the name of the non-existent entity. However, in the present case, the assessee failed to inform the assessing officer about the amalgamation for assessment year 2006-07 (year in dispute), though disclosure was made for subsequent years (AYs 2007-08 and 2008-09). The return of income filed on 28.05.2010 (post amalgamation) pursuant to notice under section 153A was filed in the name of MRPL and the fact of business reorganization was mentioned as 'not applicable" in the return form. c) In relied upon cases, the amalgamated companies participated in the assessment proceedings before the tax department in their own capacity, due to which the Apex Court affirmed that participation of amalgamated

45 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. company shall not be regarded as estoppel against law. In the present facts, the participation in the assessment proceedings was by MRPL which held itself as MRPL. d) The relied upon judgment of Saraswati Syndicate (Supra) was decided in relation to assessment issues when the amalgamation was not separately defined under the Act. Specific definition of 'amalgamation" has been incorporated in section 2(1 A) of the Act by way of amendment in 1967. 28. Other relevant observations made in the judgment while expressing the aforesaid opinion and holding that Maruti/ Spice cannot (de-hors facts) be blindly applied in all cases, pointed out following points: a) It has been observed that amalgamation is unlike winding up of a corporate entity. In the case of amalgamation, the outer shell of the corporate entity is undoubtedly destroyed; it ceases to exist. Yet, in every other sense of the term, the corporate venture continues - enfolded within the new or the existing transferee entity. In other words, the business and the adventure lives on but within a new corporate residence, i.e., the transferee company. It is, therefore, essential to look beyond the mere concept of destruction of corporate entity which brings to an end or terminates any assessment proceedings. b) Apex court noted that there are not less than 100 instances under the Act, wherein the event of amalgamation, the method

46 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. of treatment of a particular subject matter is expressly indicated in the provisions of the Act. In some instances, amalgamation results in withdrawal of a special benefit (such as an area exemption under Section 80IA) - because it is entity or unit specific. In the case of carry forward of losses and profits, a nuanced approach has been indicated. All these provisions support the idea that the enterprise or the undertaking, and the business of the amalgamating company continues. c) The beneficial treatment, in the form of set-off, deductions (in proportion to the period the transferee was in existence, vis-a- vis the transfer to the transferee company); carry forward of loss, depreciation, all bear out that under the Act, (a) the business-including the rights, assets and liabilities of the transferor company do not cease, but continue as that of the transferor company; (b) by deeming fiction- through several provisions of the Act, the treatment of various issues, is such that the transferee is deemed to carry on the enterprise as that of the transferor. d) Combined effect of Section 394 (2) of the Companies Act, 1956, Section 2 (1A) and various other provisions of the Income Tax Act, is that despite amalgamation, the business, enterprise and undertaking of the transferor or amalgamating company- which ceases to exist, after amalgamation, is treated as a continuing one, and any benefits, by way of carry forward of losses (of the transferor company), depreciation, etc., are allowed to the

47 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. transferee. Therefore, unlike a winding up, there is no end to the enterprise, with the entity. The enterprise in the case of amalgamation continues. e) Whether corporate death of an entity upon amalgamation per se invalidates an assessment order ordinarily cannot be determined on a bare application of Section 481 of the Companies Act, 1956 (and its equivalent in the 2013 Act) but would depend on the terms of the amalgamation and the facts of each case. 29. The Apex Court with the aforesaid observations, quashed the order of the High Court which held that the assessment order passed in the name of non-existent entity is invalid, and restored the revenue's appeal along with assessee's cross objections to the file of the Hon’ble Tribunal to decide the issues on merits other than nullity of assessment order.

48 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd.  Firstly, the judgment in Mahagun nowhere disagrees with the principle in Maruti and Spice. In fact, in para 33, the Court categorically held that there is no doubt that MRPL amalgamated with MIPL and ceased to exist thereafter which is an established fact and not in contention. Further the Court held that the respondent has relied upon Spice and Maruti Suzuki (supra) whereas the facts of present case can be distinguished from the facts in Spice and Maruti Suzuki.

 Secondly, the judgment by the Hon'ble Apex Court in Mahagun Realtors is rendered in peculiar facts and merely holds that the law declared in the case of Maruti Suzuki cannot be applied without looking into the overall facts, in particular the conduct of the assessee and the manner of framing of assessment.

 Thirdly, the judgment raises a pertinent point that the business of the amalgamating entity survives even after merger, though the corporate entity may have come to an end. This point is merely to emphasize that the liability of the

49 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. successor and therefore, it cannot be held that merely on account of non-existence of the predecessor, successor is not liable.

 Fourthly, in para 43, the Court categorically held that the aforesaid discussion is "having regard to the facts of this case" and the said observation is in continuation of repeated observations that the decision in Spice and Maruti are distinguishable and,

 Lastly, the Apex Court has decided the appeal on peculiar facts, without disagreeing with the decision in Maruti Suzuki India Ltd. and Spice Entertainment Ltd.

50 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. 2015-16 only and still he continued with the proceedings u/s 153A in the name of non-existing entity. Thus the entire proceedings including notice u/s 153A and also statutory notice issued in the name of non-existing entity was void ab initio. Consequently, the entire proceeding was illegal. Even the assessment order though which has been captioned as “M/s Bhadrawati Ispat & Energy Ltd. (merged with M/s. Reliable Record Keepers Pvt. Ltd. which has now known as M/s. Candor Renewable Energy Private Limited” is in fact in the name of non-existing entity only. Therefore, the reasons and principles laid down by the Hon’ble Apex Court in the case of Maruti Suzuki India Ltd. (supra) is applicable and accordingly assessment orders passed by the AO are invalid and non est.

51 I.T.A. No. 2561/Mum/2021& others M/s Candor Renewable Energy Pvt. Ltd. 33. In so far as the assessee’s cross appeals which are based on merits of the additions, the same has become purely academic and infructuous once the assessment order itself is held to be bad in law.

.उि/सहायकिंजीकार (Dy./Asstt.Registrar) आयकरअिीिीयअतिकरण, मुंबई/ ITAT, Mumbai