CH MARTHANDA RAO & CO,HYDERABAD vs. ITO, WARD - 14(1), HYDERABAD

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ITA 966/HYD/2025Status: DisposedITAT Hyderabad30 September 2025AY 2015-1618 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that an assessment cannot be made on a non-existent entity. Since the firm had ceased to exist upon conversion into a company, the assessment in its name was invalid. The matter was remanded to the AO for fresh assessment.

What were the facts?

The assessee firm was converted into a company in 2012. The Assessing Officer (AO) initiated reassessment proceedings against the firm for AY 2014-15 and 2015-16, treating its receipts as unexplained income. The CIT(A) set aside the AO's order, directing a fresh assessment.

What were the issues?

Whether assessment proceedings initiated against a firm that has ceased to exist due to conversion into a company are valid. Whether income disclosed by the successor company should be considered.

Which sections of the Income-tax Act were involved?

Section 69A,Section 147,Section 148,Section 142(1),Section 144,Section 251(1),Section 154

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Income Tax Appellate Tribunal, Hyderabad ‘A’ Bench, Hyderabad

For Appellant: Shri Madan Mohan Meena

आदेशकी �ितिलिप अ�ेिषत/ Copy of the order forwarded to:- 1. िनधा�रती/The Assessee : Shri CH Marthanda Rao and Co., C/o B.Narsing Rao & Co., LLP, Plot No.554, MLA Colony, Jubilee Hills, Hyderabad 2. राज�/ The Revenue : The ITO, Ward-14(1), Aayakar Bhawan, Hyderabad 3. The Principal Commissioner of Income Tax, Hyderabad 4. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, हैदराबाद / DR, ITAT, Hyderabad 5. गाड�फ़ाईल / Guard file

आदेशानुसार / BY ORDER

Sr. Private Secretary ITAT, Hyderabad

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