ASST CIT 8(2)(1), MUMBAI vs. SIEMENS INFORMATION PROCESSING SERVICES P.LTD, MUMBAI

O R D E R PER C.N. PRASAD (JM)

(A.Y: 2009-10) (Assessee appeal)

2. The assessee apart from challenging the Assessment Order in making transfer pricing adjustments pursuant to the direction of the DRP on merits, also challenged the validity of order of assessment passed by 3 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., the Assessing Officer by way of additional ground. The additional ground filed by the assessee reads as under: - “Additional ground of appeal

6. On the facts and in the circumstances of the case and in law, the Appellant submits that the impugned assessment order dated

24. January 2014 passed by the learned AO under Section 143(3) read with Section 144C(13) of the Income- tax Act, 1961, is bad in law as Siemens Information Processing Services Private Limited has ceased to exist on the date of the impugned order on account of its merger with Siemens Technology and Services Private Limited with effect from 01. October 201 1, thereby the entire assessment proceedings be regarded to be void ab-initio.

3. The Ld. Counsel for the assessee submits that since the additional ground is purely legal ground going to the very jurisdiction and validity of Assessment Order the same be admitted. Reliance is placed on the decision of the Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. v. CIT [229 ITR 383]. Ld.DR strongly opposed for admission of additional ground.

4. On hearing both the parties, we are of the view that the additional ground raised by the assessee is purely a legal ground and going to the very jurisdiction and validity of the Assessment Order and no new facts have to be examined, the same is to be admitted following the decision of the Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. v. CIT (supra) thus the additional ground is admitted.

5. Briefly stated, the facts are, by virtue of an order passed by the Hon'ble Bombay High Court on 26.08.2011 an order approving the Services Pvt. Ltd., [hereinafter in short “SIPSPL”], the assessee in this case, was amalgamated with M/s. Siemens Technology and Services Pvt. Ltd., [hereinafter in short “STSPL”] w.e.f. 01.10.2011 and accordingly ceased to exist thereafter. The Assessing Officer passed order u/s.143(3) r.w.s. 144C(13) of the Act in the name of “M/s. Siemens Information Processing Services Pvt. Ltd., [successor of M/s. Siemens Technology Services Pvt. Ltd.,]” on 24.01.2014. Now it is the contention of the Ld.Counsel for the assessee that the erstwhile company namely SIPSPL ceased to exist on account of its merger with STSPL w.e.f. 01.10.2011 and consequently the Assessing Officer made an assessment on a non-existent entity. It is the submission of the Ld. Counsel for the assessee that the Assessing Officer proceeded to assess the income in the hands of the erstwhile company in spite of being intimated about the merger. The sequence of events in this regard were explained as under:

Sequence and description of events Date Reference Order of Hon'ble Bombay High Court 26 August 2011 Page 299-320 of paper sanctioning the amalgamation with effect book filed on 15 March from 1 October 201 1 2017 Order of Hon'ble Karnataka. Bangalore High 30 September 2011 Page 321-345 of paper Court sanctioning the amalgamation with book filed on 15 March effect from 1 October 2011 2017 Letter filed with the learned AO intimating 21 December 2011 Page 346 of paper book regarding the amalgamation filed on 15 March 20 17 Letter filed with the learned AO intimating 20 June 2012 Page 347-349 of paper change of name of Siemens Information book filed on 15 March Systems Limited to Siemens Technology and 2017 Services Private Limited with effect from 23 April 2012

5 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., Sequence and description of events Date Reference Letter issued by the learned Assistant 26 December 2012 Page 350-351 of paper Commissioner of Income Tax, Circle-12(3). book filed on 15 March Bangalore to the learned Assistant/ Deputy 2017 Commissioner of Income-tax, Circle-7(2), Mumbai for transfer of case of the Appellant from Bangalore to Mumbai Order passed by the learned Transfer Pricing 15 January 2013 Page 72-124 of the Officer under Section 92CA(3) of the Act Appeal set dated 28 February 2014 Draft assessment order passed by the 18 February 2013 Page 66-71 of the Appeal learned AO under Section 144C(1) read with set dated 28 February Section 143(3) of the Act 2014 Directions of the Dispute Resolution Panel 28 November 2013 Page 12-25 of the Appeal under Section 144C(5) of the Act set dated 28 February 2014 Final assessment order passed by the 24 January 2014 Page 9-11 of the appeal learned AO under Section 143(3) read with set dated 28 February Section 144C( 13) of the Act

6. Therefore, it was contended that post amalgamation the amalgamating company ceased to exist and accordingly assessment being made in the name of non-existing entity is illegal and bad in law.

Thus, it is submitted that the assessment made in the name of SIPSPL should be quashed and be regarded as void ab-initio. Reliance was placed on the following decisions: -

(i). Jitendra Chandralal Navlani & Anr v/s. Union of India through Joint Secretary & Ors. (Writ Petition No. 1069 OF 2016 Bombay High Court) (ii). IPSOS Research Private Limited (formerly known as Synovate India Private Limited) Vs. Additional Commissioner of Income Tax-Circle 11(2) (formerly known as Synovate India Private Limited) and IPSOS Research Private Limited (formerly known as Synovate India Private Limited) Vs. Deputy Commissioner of Income Tax-Circle 10(1)(1) (ITA. No. 1177/Mum/2015: 1TA. No. 1517/Mum/2016 Bombay High Court) (iii). Commissioner Of Income Tax (C)-lI Vs. Micra India Pvt Ltd (1TA 441/2013: 1TA 444/2013: 1TA 445/2013: 1TA 446/2013: 1TA 452/2013: IT A 461/2013 New Delhi High Court) (iv). Commissioner of Income-tax. Central Circle, Bangalore Vs. Intel Technology India (P.) Ltd. (IT APPEAL NOS. 499 & 500 OF 2009 Karnataka High Court) (v). l.K. Agencies (P.) Ltd. Vs. Commissioner of Wealth-tax (AWT NOS. 1 TO 3 OF 2003 (Calcutta High Court)

6 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., 7. The Ld. Counsel for the assessee further submits that, even in the scenario wherein the name of the amalgamated company is merely referred in the Assessment Order after the name of the amalgamating company still the Assessment Order is invalid void ab-initio and bad in law. Strong reliance was placed on the following decisions: (i). Principal Commissioner of Income-tax v. BMA Capfin Ltd. (Special Leave Petition (Civil) Diary No. 40486 OF 2018 Supreme Court) (ii). Principal Commissioner of Income Tax. Central-2 v. BMA Capfin Ltd. (IT Appeal No. 1181 OF 2017 New Delhi High Court) (iii). Maruti Suzuki India Ltd. v. Deputy Commissioner of Income-tax, Circle- 16(1), New Delhi (IT APPEAL NO. 288 (DELHI) OF 2016 New Delhi High Court) (iv). Pr. Commissioner Of Income Tax-6. New Delhi Vs. Maruti Suzuki India Limited (Successor Of Suzuki Powertrain India Limited) (ITA No. 65/2017 (New Delhi ITAT) (v). Ambuja Cements Rajasthan Ltd. (since dissolved) Vs Assistant Commissioner of Wealth Tax-LTU (WTA NO. 11/MUM/2014 Mumbai ITAT).

8. However the Ld. DR submits that the Assessment Order dated 24.01.2014 passed by the Assessing Officer u/s. 143(3) r.w.s. 144C(13) of the Act was on the directions given by the DRP and in the DRP’s order name of the assessee has been mentioned that M/s. Siemens Information Processing Services Pvt. Ltd.,(successor of M/s. Siemens Technology and Services Pvt. Ltd.,). Therefore, the Ld.DR submits that since the DRP has passed the order in the name of M/s. Siemens Technology and Services Pvt. Ltd., the amalgamated company the error committed by the 7 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., Assessing Officer in writing “Successor of” appears to be typographical error and it is an omission in terms of Section 292B of the Act.

11. As could be seen from the above letter the Assessing Officer was intimated by the assessee that SIPSPL with PAN: AAFCS1164H has been merged with SISL with PAN: AAACS9788E, which was later name

9 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., changed to M/s. Siemens Technology and Services Pvt. Ltd., [STSPL] w.e.f 23.04.2012.

12. We also noticed that by letter dated 26.12.2012 the then Assessing Officer ACIT, Circle-12(3), Bangalore intimated the Assessing Officer of STSPL i.e. ACIT, Circle-7(2), Mumbai that consequent to merger of SIPSPL with STSPL by virtue of the order of the Hon'ble Karnataka High Court dated 30.09.2011 the assessment records are forwarded to ACIT and the ACIT, Circle 12(3), Bangalore has ceased all the jurisdiction over the SIPSPL as it has become a nonexistent company as on that date i.e. 26.12.2012.

13. Subsequently the Transfer Pricing Officer passed order u/s. 92CA of the Act on 15.01.2013 in the name of amalgamating company SIPSPL. Similarly, the draft Assessment Order was passed by the DCIT, Circle- 7(2), Mumbai on 18.02.2013 in the name of M/s. Siemens Information Processing Services Pvt. Ltd., [successor M/s. Siemens Technology and Services Pvt. Ltd.,].

14. Ld. DRP also passed order in the name of M/s. Siemens Information Processing Services Pvt. Ltd., the amalgamating company (successor M/s. Siemens Technology and Services Pvt. Ltd.,) though in some of these orders it has been mentioned in brackets that SIPSPL is successor

10 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., of STSPL surprisingly in all these orders the PAN of the amalgamating company i.e. AAFCS1164H has been mention and not the amalgamated company PAN which is AAACS9788E. From the above, it is clear that the Assessing Officer made assessment on 24.01.2014 u/s. 143(3) r.w.s. 144C(13) of the Act only in the name of amalgamating company i.e. SIPSPL though it was ceased w.e.f. 01.10.2011 in spite of intimating the amalgamation and merger of SIPSPL with SISL which was later changed to STSPL.

15. The Hon'ble Delhi High Court in the case of CIT v. Dimension Apparels Pvt. Ltd., in ITA.No. 327/2014, C.M.NO. 10527/2014 dated 08.07.2014 had considered a situation whether the provisions of section 292B of the Act could cure the technical defects and also the provisions of section 170(1) and 170(2) of the Act and the Hon'ble High Court considered various decision held as under: - “4 The revenue, in its appeal argues, first of all that by virtue of Sections 170(1) and 170(2) of the Income Tax Act, in cases of succession of business, where the predecessor cannot be found, the assessment that would otherwise have been made upon the predecessor, shall instead be made upon the successor in a like manner. It is secondly contended that the error in the assessment order, if any, is a minor one, at best an irregularity; thus saved by Section 292B of the Act. It was argued lastly that the assessee had itself participated in the proceedings throughout and could not be heard to complain against the assessment order. The revenue relies on the Madras High Court ruling in Marshall Sons and Co. vs. Income Tax Officer (1992) 195 ITR 417. 5. The assessee contends that no question of law arises for consideration. It submits that the text and phraseology of Sections 170 (1) and (2) do not support the revenue's arguments. The assessee further relies on Saraswati Industrial Syndicate v. CIT, 1990 Supl. (1) SCR 332 in support of its contentions and the findings of the tax authorities below, i.e. the CIT (A) and the ITAT. Spice Entertainment Ltd. Vs. CIT - of 2011, decided by a Division Bench of this Court, as well as an earlier decision in Commissioner of Income Tax v. Vived 11 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., Marketing Servicing Pvt. Ltd. ITA No. 273/2009 were relied on by the assessee as well, in support of its contentions. It was also pointed out that the jurisdictional defect in this case could not be cured under Section 292-B of the Act.

6. Sections 170(1) and 170(2) of the Act do not assist the revenue in their case. The revenue does not contest that in a case of amalgamation, the predecessor (being a dissolved company) “cannot be found”. Consequently, Section 170(2) applies. This provision clarifies that where 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 the succession and of the precious 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.” (Emphasis Supplied) 7. The revenue seems to argue that the assessment is justified because the liabilities of the amalgamating company accrue to the amalgamated (transferee) company. While that is true, the question here is which entity must the assessment be made on. The text of Section 170(2) makes it clear that the assessment must be made on the successor (i.e., the amalgamated company).

8. The Supreme Court, in Saraswati Industrial Syndicate (supra) held that “after the amalgamation of the two companies the transferor company ceased to have any entity and the amalgamated company acquired a new status and it was not possible to treat the two companies as partners or jointly liable in respect of their liabilities and assets.” (Emphasis Supplied) 9. With respect to the specific issue of assessment, in Vived Marketing Servicing Pvt. Ltd. No. (supra) the Court observed that: “When the Assessing Officer passed the order of assessment against the respondent company, it had already been dissolved and struck off the register of the Registrar of companies u/s 560 of the Companies Act. In these circumstances, the Tribunal rightly held that there could not have been any assessmsent order passed against the company which was not in existence as on that date in the eyes of law it had already been dissolved.” (Emphasis Supplied) 10. Vived Marketing Servicing Pvt. Ltd. (supra) also noted that Section 176 of the IT Act, which contains provisions pertaining to a discontinuation of business, does not apply to a case of amalgamation/dissolution. It was also held that Section 159 of the Act, which provides for tax liability to be attached to the legal representatives of a deceased person, is likewise inapplicable. The language of Section 159 evidently only applies to natural persons, and cannot be extended, through a legal fiction, to the dissolution of companies.

11. Marshall Sons and Co. (supra), is relied on by the revenue. It was held in that judgment that “the transferor-company shall, with effect from the transfer date, be deemed to have carried on its business for and on behalf of the transferee- company and, accordingly, the profits and losses of the transferor- company for the period commencing from the transfer date, shall be deemed to be the profits or losses of the transferee-company and shall be available to the transferee-company for disposal in any manner.”

12. That case, however, involved a controversy about the effective date of amalgamation, and not about whether an assessment of income can be made on 12 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., an amalgamated company. In fact, the logic of the Madras High Court’s decision undermines the Appellants’ case. The Madras High Court found for the Revenue, because, in its opinion, the effective date of amalgamation came after the date of the assessment. The assessee argued that the date of amalgamation was January 1, 1982, whereas the assessment order was dated November 25, 1984.

13. The Madras High Court held that “according to the records maintained pursuant to the provisions of the Companies Act, the subsidiary company had continued to remain in existence up to January 21, 1986, even long after January 1, 1982.”

14. On this basis, it held the Assessee liable. This obviously implies that had the company not been in existence at the time of the assessment order, it would not have been liable.

15. In Spice (supra), this Court, after discussing the law declared by the Supreme Court in Saraswati Industrial Syndicate (supra) stated that: "9. The Court referred to its earlier judgment in General Radio and Appliances Co. Ltd. Vs. M.A. Khader (1986) 60 Comp Case 1013. In view of the aforesaid clinching position in law, it is difficult to digest the circuitous route adopted by the Tribunal holding that the assessment was in fact in the name of amalgamated company and there was only a procedural defect.

10. Section 481 of the Companies Act provides for dissolution of the company. The Company Judge in the High Court can order dissolution of a company on the grounds stated therein. The effect of the dissolution is that the company no more survives. The dissolution puts an end to the existence of the company. It is held in M.H. Smith (Plant Hire) Ltd. Vs. D.L. Mainwaring (T/A Inshore), 1986 BCLC 342 (CA) that "once a company is dissolved it becomes a non-existent 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 maintain an action in the name of the company after the latter had been dissolved.

16. The authority of the above precedent binds us; we see no reason to differ from the logic and reasoning in Spice (supra).

23. It is thus clear that all contentions sought to be urged by the revenue are in respect of familiar grounds, which have been ruled upon, against it, consistently in two decisions of this court. Therefore, no substantial question of law arises in this appeal.

24. Accordingly, there is no merit in the appeals; they are accordingly dismissed along with the pending applications without any order as to costs.”

16. The Hon'ble Karnataka High Court in the case of CIT v. Intel Technology India (P.) Ltd., (supra) held as under:

“4. This appeal was admitted by order dated 21.07.2010 on the substantial questions of law as had been framed in the memo which reads as under: - (1) Whether the Tribunal was correct in holding that the order passed by the Assessing Officer on M/s Software & Silicon Systems India Pvt. Ltd., after being intimated about the merger with M/s Intel Technology India Pvt. Ltd., was without jurisdiction against the said company and null and void? (2) Whether the Tribunal was correct in holding that the provisions of section 292B of the Act will not make the assessment valid as a defect/omission to incorporate the name of M/s Intel Technology India Pvt. Ltd., in the assessment order as the same is not in substance and effect in confirmative with or according to the intend and purpose of this Act? (3) Whether the Tribunal has to examine the matter on merits and record finding on the controversy raised before it both by the revenue as well as the assessee in their separate appeals? 5. The tribunal had rejected the claim of the department on the ground that the assessment proceedings against SSS Limited (which was non-existent on the date of passing of the assessment order) cannot be held to be valid proceedings, learned counsel for the appellant has submitted that the return of income had been filed by the assessee-SSS Limited much prior to the amalgamation order dated 1.4.2004 and as such, the proceedings would continue against the said company even after the amalgamation, especially when the successor company - M/s Intel Technology India Pvt. Ltd. had participated in the proceedings. Learned counsel for the appellant further submits that the department would be entitled to the benefit of Section 292(B) of the Income Tax Act.

7. In the present case also, the proceedings had been initiated against a non- existing company/SSS Limited even after the amalgamation of the said company with M/s Intel Technology India Pvt. Ltd.. We do not see any good ground to differ with the said judgment of the Delhi High Court.

8. Accordingly, for the reasons given in the judgment of the Delhi High Court in the case of Spice Infotainment Ltd. (supra], these appeals are dismissed and we decide the substantial questions of law in favour of the assessee and against the revenue.”

17. In the case of Spice Infotainment Ltd. v. CIT in ITA.No. 475 & 476 of 2011 dated 03.08.2011 the Hon'ble Delhi High Court held as under:

12. Once it is found that assessment is framed in the name of non-existing entity, it does not remain a procedural irregularity of the nature which could be cured by invoking the provisions of Section 292B of the Act. Section 292B of the Act reads as under:- “292B. No return of income assessment, notice, summons or other proceedings furnished or made or issue or taken or purported to have been furnished or made or issued or taken in pursuance of any of the provisions of this Act shall be invalid or shall be deemed to be invalid merely by reasons of any mistake, defect or omission in such return of income, assessment, notice, summons or other proceeding if such return of income, assessment, notice, summons or other proceedings is in substance and effect in conformity with or according to the intent and purpose of this Act.

14. The issue again cropped up before the Court in CIT Vs. Harjinder Kaur (2009) 222 CTR 254 (P&H). That was a case where return in question filed by the assessee was neither signed by the assessee nor verified in terms of the mandate 16 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., of Section 140 of the Act. The Court was of the opinion that such a return cannot be treated as return even a return filed by the assessee and this inherent defect could not be cured inspite of the deeming effect of Section 292B of the Act. Therefore, the return was absolutely invalid and assessment could not be made on a invalid return. In the process, the Court observed as under:- “Having given our thoughtful consideration to the submission advanced by the learned Counsel for the appellant, we are of the view that the provisions of Section 292B of the 1961 Act do not authorize the AO to ignore a defect of a substantive nature and it is, therefore, that the aforesaid provision categorically records that a return would not be treated as invalid, if the same "in substance and effect is in conformity with or according to the intent and purpose of this Act". Insofar as the return under reference is concerned, in terms of Section 140 of the 1961 Act, the same cannot be treated to be even a return filed by the respondent assessee, as the same does not even bear her signatures and had not even been verified by her. In the aforesaid view of the matter, it is not possible for us to accept that the return allegedly filed by the assessee was in substance and effect in conformity with or according to the intent and purpose of this Act. Thus viewed, it is not possible for us to accept the contention advanced by the learned Counsel for the appellant on the basis of Section 292B of the 1961 Act. The return under reference, which had been taken into consideration by the Revenue, was an absolutely invalid return as it had a glaring inherent defect which could not be cured in spite of the deeming effect of Section 292B of the 1961 Act.”

15. Likewise, in the case of Sri Nath Suresh Chand Ram Naresh Vs. CIT (2006) 280 ITR 396, the Allahabad High Court held that the issue of notice under Section 148 of the Income Tax Act is a condition precedent to the validity of any assessment order to be passed under section 147 of the Act and when such a notice is not issued and assessment made, such a defect cannot be treated as cured under Section 292B of the Act. The Court observed that this provisions condones the invalidity which arises merely by mistake, defect or omission in a notice, if in substance and effect it is in conformity with or according to the intent and purpose of this Act. Since no valid notice was served on the assessee to reassess the income, all the consequent proceedings were null and void and it was not a case of irregularity. Therefore, Section 292B of the Act had no application.

17. The order of the Tribunal is, therefore, clearly unsustainable. We, thus, decide the questions of law in favour of the assessee and against the Revenue and allow these appeals.”

18. We also observe that the appeal filed by the Revenue against this judgment of the Hon'ble Delhi High Court was dismissed by the Hon'ble

17 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., Supreme Court on 02.11.2017 affirming the decision of the High Court wherein it has been held that framing of assessment against a non-existing entity goes to the root of the matter which is not a procedural irregularity but a jurisdictional defect and therefore there cannot be any assessment against a dead person and the provisions of section 292B of the Act have no application.

19. The Hon'ble Delhi High Court in the case of Pr.CIT v. BMA Capfin Ltd. [100 taxmann.com 329] held as under: - “1. The revenue is aggrieved by the decision of the Income Tax Appellate Tribunal ("ITAT") which upheld the appellate Commissioner's order nullifying the assessments made for AY 2012-13. In this case M/s Xenial Investments Pvt. Ltd., the original assessee filed a return of income on 01.11.2004 under Section 115JB of the Income-tax Act, 1961. The original assessment was completed but the matter was remitted on two occasions. In the third round, in reply to notice, the assessee had indicated that it underwent an entity change inasmuch as merger and amalgamation had been approved by the Court vide order dated 10.10.2013 w.e.f. 01.04.2012. Apparently, the AO took note of this development but instead of completing the assessment in the hands and in the name of the amalgamated or merged entity, i.e., Adhunik Technology Pvt. Ltd., it proceeded to complete the separate assessment in the name of the (by then) non-existent entity, i.e., M/s Xenial Investments Pvt. Ltd. Applying the ratio of the decision of this Court in Spice Entertainment v. CIT [IT Appeal No. 475 of 2011] and CIT v. Dimension Apparel (P., Ltd. [20141 52 taxmann.com 356/[2015] 370 ITR 288 (Delhi), the ITAT upheld the CIT (A)'s decision and held that the assessment was a nullity.

18 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., 4. For these reasons, following the previous reasons, it is held that no question of law arises; the appeal is, therefore, dismissed.

21. Hon'ble Delhi High Court in the case of Pr.CIT v. Maruti Suzuki India Limited (successor of Suzuki Powertrain India Limited) in ITA.No. 65 of 2017 held as under: -

3. On 24th January 2017, while admitting this appeal, this Court framed the following question of law: “Did the ITAT misapply the provisions of Section 170 (2) of the Income Tax Act in the circumstances of the case, while concluding that the assessment order was not tenable for having been framed in the name of the non- existent company.

6. Thereafter, assessment proceedings continued with the participation of ITA 65/2017 Page 3 of 8 MSIL representing SPIL in the assessment proceedings.

19 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., 9. On the strength of the decision of the Supreme Court in Kuldeep Kumar Dubey v. Ramesh Chandra Goyal (2015) 3 SCC 525, Mr. Asheesh Jain, learned Senior Standing Counsel for the Revenue, urges that in the present case the error, if at all, was a mere misdescription of the party in the assessment order and nothing more. This could not result in the assessment order itself being set aside. He further submits that the record of the assessment proceedings shows that MSIL participated in it fully and raised no objection as to the continuation of the proceedings on the ground of lack of jurisdiction. Mr Jain invokes Section 292B of the Act to urge that the Assessee is precluded from questioning the assessment order on the ground that it was passed in the name of a non-existent entity. He points out that below the name of the Amalgamating Company, the AO has taken care to mention that it has since been amalgamated with MSIL.

10. In reply, Mr. Ajay Vohra, learned Senior Counsel for the Assessee, has drawn the attention of the Court to a long line of decisions including Saraswati Industrial Syndicate Ltd. v. CIT [1990] 186 ITR 278 (SC) and Spice Infotainment Ltd. v. CIT (2011) 247 CTR (Del) 500 wherein an identical question has been answered in favour of the Assessee and against the Revenue. Mr. Vohra points out that for the purposes of Section 170 (2) of the Act, two assessment orders will have to be passed: one in the name of MSIL itself for the AY in question and the other again in the name of MSIL indicating that the said assessment order is being passed under Section 170 (2) of the Act in respect of its tax liability as successor in interest of the Amalgamating company. 11.1 In Spice Infotainment (supra), the issue that arose was in the context of the AO having framed the assessment in the name of ‘Spice Corp Limited’ after the said entity stood dissolved consequent to its amalgamation with ‘MCorp Private Limited’ with effect from 1 st July, 2003. Like in the present case, even there it was urged by the Revenue that this was a procedural defect. It was also urged by the Revenue that since the amalgamated entity had participated in the assessment proceedings without raising any objection, it should be precluded from raising it thereafter. 11.2 The two questions framed by this Court in Spice Infotainment (supra) were as under: “(i) Whether on the facts and in the circumstances of the case, the Tribunal erred in law in holding that the action of the Assessing Officer in framing assessment in the name of “Spice Corp Ltd”, after the said entity stood dissolved consequent upon its amalgamation with Mcorp Private Limited w.e.f. 01.07.2003, was a mere “procedural defect”? (ii) whether on the facts and in the circumstances of the case, the Tribunal erred in law in holding that in view of the provisions of section 292B of the Act, the assessment, having in substance and effect, been framed on the amalgamated company which could not be regarded as null and void?” 11.3 This Court, in Spice Infotainment (supra) discussed and noted the following observations in the decision of the Supreme Court in Saraswati Industrial Syndicate (supra): “Generally, where only one Company is involved in change and the rights of the shareholders and creditors are varied, it amounts to reconstruction or reorganisation or scheme of arrangement. In amalgamation two or more companies are fused into one by merger or by taking over by another. Reconstruction or amalgamation has no precise legal meaning. The amalgamation is a blending of two or more existing undertakings into one undertaking, the shareholders of each blending Company become 20 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., 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 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 Halsburys Laws of England 4th Edition Vol. 7 Para 1539. Two companies may join to form a new Company, but there may be absorption or blending of one by the other, both amount to amalgamation. When two companies are merged and are so joined, as to form a third Company or one is absorbed into one or blended with another, the amalgamating Company loses its entity.” 11.4 The Court in Spice Infotainment (supra) thereafter held as under: “11. After the sanction of the scheme on 11th April, 2004, the Spice ceases to exit w.e.f. 1st July, 2003. Even if Spice had filed the returns, it became incumbent upon the Income tax authorities to substitute the successor in place of the said “dead person. When notice under Section 143 (2) was sent, the appellant/amalgamated company appeared and brought this fact to the knowledge of the AO. He, however, did not substitute the name of the appellant on record. Instead, the Assessing Officer made the assessment in the name of M/s Spice which was non existing entity on that day. In such proceedings and assessment order passed in the name of M/s Spice would clearly be void. Such a defect cannot be treated as procedural defect. Mere participation by the appellant would be of no effect as there is no estoppel against law. 11.5 Consequently, the aforesaid two questions were answered in favour of the Assessee and against the Revenue.

12. Even thereafter the Revenue has repeatedly brought the said issue before this Court in a large number of cases where, in more or less identical circumstances, the AO had passed the assessment order in the name of the entity that had ceased to exist as on the date of the assessment order. In many of these cases, as in the present case, the AO, after mentioning the name of the Amalgamating Company as the Assessee, mentioned below it the name of the Amalgamated Company. Illustratively the cases are: (i) CIT v Micra India (P) Ltd. (2015) 231 Taxman 809 (Del); (ii) CIT v. Micron Steels (P) Ltd. [2015] 372 ITR 386 (Del) (iii) CIT v. Dimensions Apparels (P) Ltd. [2015] 370 ITR 288 (Del) (iv) BDR Builders & Developers Pvt. Ltd. v. ACIT (Decision dated 26th July 2017 passed by this Court in W.P.(C) No. 2712 of 2016 13. The question whether, for the purposes of Section 170 (2) of the Act, the defect of passing the assessment order in the name of an non-existent entity is a mere irregularity was answered by this Court in CIT v. Dimensions Apparels (P) Ltd. (supra), where in paras 6 and 7 it was held as under: “6. Sections 170(1) and 170(2) of the Act do not assist the revenue in their case. The revenue does not contest that in a case of amalgamation, the predecessor (being a dissolved company) “cannot be found”. Consequently, Section 170(2) applies. This provision clarifies that where 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 the succession and of the precious 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.” (Emphasis Supplied)

21 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., 7. The revenue seems to argue that the assessment is justified because the liabilities of the amalgamating company accrue to the amalgamated (transferee) company. While that is true, the question here is which entity must the assessment be made on. The text of Section 170(2) makes it clear that the assessment must be made on the successor (i.e., the amalgamated company).”

16. The legal position having been made abundantly clear in the above decisions, the Court has no hesitation in answering the question framed in the negative, i.e. in favour of the Assessee and against the Revenue.”

“17 Mr Zoheb Hossain, learned Counsel appearing on behalf of the appellant submitted that: (i) The High Court was not justified in quashing the final assessment order under Section 143 (3) only on the ground that the assessment was framed in the name of the amalgamating company, which was not in existence, ignoring the fact that the names of both the amalgamated company and the amalgamating company were mentioned in the assessment order; (ii) Even on the hypothesis that the assessment order was framed incorrectly in the name of the amalgamating company, it would amount to a “mistake, defect or omission” which is curable under Section 292B when the assessment is, “in substance and effect, in conformity with or according to the intent and purpose” of the Act;

22 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., (iii) During the assessment proceedings and the subsequent proceedings in appeal, the amalgamating company was duly represented by the amalgamated company. No prejudice was caused to any of the parties by the assessment order and hence rendering the assessment order invalid on a ‘mere technicality’ would be incorrect in law. There was effective participation of the assessee in the assessment proceedings and there was no doubt in the minds of those who participated about the entity in relation to which the assessment proceedings took place; (iv) In Spice Entertainment Ltd. v Commissioner of Service Tax (“Spice Entertainment”), the final assessment order only referred to the name of the erstwhile entity which was non-existent and there was no reference to the resulting company. In distinction, in the present case, in both the draft and the final assessment orders, the names of both the amalgamating and amalgamated companies were mentioned; (v) In paragraph 11 of the decision of the Delhi High Court in Spice Entertainment, it was held that: “11. After the sanction of the scheme on 11th April, 2004, the Spice ceases to exist w.e.f. 1st July, 2003. Even if Spice had filed the returns, it became incumbent upon the Income tax authorities to substitute the successor in place of the said ‘dead person’. When notice under Section 143(2) was sent, the appellant/amalgamated company appeared and brought this fact to the knowledge of the AO. He, however, did not substitute the name of the appellant on record. Instead, the Assessing Officer made the assessment in the name of M/s Spice which was non existing entity on that day. In such proceedings and assessment order passed in the name of M/s Spice would clearly be void. Such a defect cannot be treated as procedural defect. Mere participation by the appellant would be of no effect as there is no estoppel against law.” From the above extract, it would emerge that if an assessment order had been passed on the resulting company, it would not be void. Hence, in the present case, the issuance of a notice under Section 143 (2) to SPIL cannot be considered to be a jurisdictional effect when the assessment order categorically mentions the names of the amalgamated and amalgamating companies; (vi) The decision of the Delhi High Court in Skylight Hospitality LLP v Assistant Commissioner of Income Tax, Circle-28(1), New Delhi12 (“Skylight Hospitality LLP”), which was confirmed by this Court on 6 April 201813 dealt with a situation where a notice under Section 148 was issued in the name of a non-existent private limited company. The Court held that the defect in recording the name of a non-existent company in a notice under Section 148 was a procedural defect or mistake curable under Section 292B, since no prejudice was caused to the assessee. The Delhi High Court distinguished the decision in Spice Entertainment on the ground that in that case even the final assessment order was in the name of a non- existent company; (vii) In the present case, both the draft assessment order and the final assessment order contained the names of the amalgamated and amalgamating companies and hence it cannot be held that the final order is in the name of a non-existent company. The order of the TPO is not the subject of a challenge by the assessee before any forum. The directions of the TPO were implemented by the assessing officer in the draft assessment order in accordance wi Section 144C(1) which was then

23 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., challenged by the assessee before the DRP under Section 144C(2). Since the names of both the amalgamated and amalgamating companies were mentioned in the draft assessment order and final assessment order, there is no jurisdictional defect; (viii) In view the decision of this Court in Kunhayammed v State of Kerala (“Kunhayammed”), though the doctrine of merger does not apply when a Special Leave Petition is dismissed before the grant of leave to appeal, where an order rejecting a Special Leave Petition is a speaking order and reasons have been assigned for rejecting the petition, the law stated or declared in such an order will attract Article 141; and (ix) Consequently, in the alternative, in view of the order passed by this Court on 6 April 2018 in Skylight Hospitality LLP on the one hand and the order dated 16 July 2018 in the case of the present assessee for AY 2011-12 and the earlier order dated 2 November 2017 in CIT, New Delhi v Spice Enfotainment Ltd.(“Spice Enfotainment Ltd”), there appears to be a direct conflict of views on the principle whether a notice issued to a non-existent company would suffer from a jurisdictional error or whether it is a mere defect or mistake which would be governed by Section 292B. 18 On the other hand, Mr Ajay Vohra, learned Senior Counsel appearing on behalf of the respondents submitted that: (i) Upon a scheme of amalgamation being sanctioned, the amalgamated company is dissolved without winding up, in terms of Section 394 of the Companies Act 1956. The amalgamating company ceases to exist in the eyes of law [Saraswati Industrial Syndicate Ltd. v CIT (“Saraswati Industrial Syndicate Ltd.”)]; (ii) The amalgamating company cannot thereafter be regarded as a "person" in terms of Section 2(31) of the Act 1961 against whom assessment proceedings can be initiated and an assessment order passed; (iii) 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. • It has been held in the following decisions that, if a statutory notice is issued in the name of a non-existent entity, the entire assessment would be a nullity in the eyes of law: - CIT v Intel Technology India (P) Ltd - PCIT v Nokia Solutions & Network India (P) Ltd. (“Nokia Solutions”) - Spice Entertainment - Similarly, a notice to the amalgamating company, subsequent to the amalgamation becoming effective and despite the fact of the amalgamation having been brought to the notice of the assessing officer, is void ab initio as held in the following decisions: - BDR Builders and Developers Pvt. Ltd. v ACIT - Rustagi Engineering Udyog (P.) Ltd. v DCIT

24 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., - Khurana Engineering Ltd. v DCIT - Takshashila Realties (P) Ltd. v DCIT - Alamelu Veerappan v ITO23 (“Alamelu Veerappan”) (iv) The order passed by the TPO in the name of SPIL, a non-existent entity was invalid in the eyes of the law: • 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 DRP etc.; and • Furthermore, 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. (v) The assessment framed in the name of the amalgamating Company is invalid: • In terms of Section 170(2) of the Act, once the amalgamation is effective, assessment in respect of the income of the amalgamating company upto the appointed date has to be in the name of the amalgamated company as successor in interest of the amalgamating company. • The Delhi High Court has held in Spice Entertainment that an assessment framed in the name of the amalgamating company, which ceased to exist in the eyes of law, was invalid and untenable in law. Such a defect would not be cured in terms of Section 292B of the Act. Further, the fact that the amalgamated company participated in the assessment proceedings would not operate as estoppel. • Following the aforesaid decision of the High Court in the case of Spice Entertainment, the Delhi High Court quashed assessment orders which were framed in the name of an amalgamating company, recording also the name of the amalgamated company, in the following cases: - CIT v Dimension Apparels Pvt. Ltd24 (“Dimension Apparels”); affirmed by this Hon'ble Court vide Civil Appeal No. 3125 of 2015; - CIT v Micron Steels P. Ltd. (“Micron Steels”); and - CIT v Micra India (P) Ltd. (“Micra India”) The aforesaid judgments of the Delhi High Court have been approved by this Court in Civil Appeal No.285 of 2014 (& other connected matters). Thus applying the doctrine of merger, the law laid down by the Delhi High Court has become a precedent under Article 141. (vi) The Respondent's case is squarely covered by the decision of this Court in its own case for the immediately preceding year: • The Delhi High Court by its judgment reported in Maruti Suzuki held in favour of the Respondent by following the judgment in the case of Spice Entertainment.

25 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., • Further, the Revenue's SLP was dismissed by this Court on 16 July 2018 in SLP(C) D.No.14106/2018, following the judgment in Spice Entertainment. • Relying on the decision of this Hon'ble Court, in the following decisions, assessments framed in the case of a non-existent entity (the amalgamating company) have been held to be non-est in the eyes of law: - CIT v BMA Capfin Ltd. (Revenue's SLP dismissed against the same vide order dated 19 November 2018 passed in SLP(C) Diary No.40486 of 2018). - Nokia Solutions (vii) The judgment of the Delhi High Court in Skylight Hospitality LLP is distinguishable and is not applicable to the facts of the present case: • The judgment was rendered on its own peculiar facts. • In that case, the tax evasion petition mentioned the factum of conversion of the company into a Limited Liability Partnership, which was also noticed in the reasons to believe and approval of the Principal Commissioner (before issuance of a notice under Section 148 of the Act). However, only because of a clerical mistake, the notice was wrongly issued in the name of Skylight Hospitality Pvt. Ltd. instead of Skylight Hospitality LLP. • In the aforesaid facts, the High Court held that this was an irregularity and procedural/ technical lapse which was curable under section 292B of the Act. • The decision in the case of Spice Enfotainment was not followed on the ground that it pertained to the passing of an assessment order in the name of a non-existent entity whereas the case at hand dealt with a notice under Section 148 of the Act. • The SLP filed by the assessee against the decision of the Delhi High Court was dismissed recording: "In the peculiar facts of this case, we are convinced that wrong name given in the notice was merely a clerical error which could be corrected under Section 292B of Act 1961"; • Subsequently, various High Courts, including the Delhi High Court have in the following decisions distinguished the judgment in the case of Skylight Hospitality LLP and have quashed the notice/assessment framed in the name of a non-existent entity: - Rajender Kumar Sehgal v ITO (“Rajender Kumar Sehgal”) - Chandreshbhai Jayantibhai Patel v ITO (“Chandreshbhai Jayantibhai Patel”); and - Alamelu Veerappan 19. While assessing the merits of the rival submissions, it is necessary at the outset to advert to certain significant facets of the present case: (i) Firstly, the income which is sought to be subjected to the charge of tax for AY 2012-13 is the income of the erstwhile entity (SPIL) prior to amalgamation. This is on account of a transfer pricing addition of Rs. 78.97 crores;

26 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., (ii) Secondly, under the approved scheme of amalgamation, the transferee has assumed the liabilities of the transferor company, including tax liabilities; (iii) Thirdly, the consequence of the scheme of amalgamation approved under Section 394 of the Companies Act 1956 is that the amalgamating company ceased to exist. In Saraswati Industrial Syndicate Ltd., the principle has been formulated by this Court in the following observations: “5. Generally, where only one company is involved in change and the rights of the shareholders and creditors are varied, it amounts to reconstruction or reorganisation of scheme of arrangement. In amalgamation two or more companies are fused into one by merger or by taking over by another. Reconstruction or ‘amalgamation’ has no precise legal meaning. The 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 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 Laws of England (4th edition volume 7 para 1539). Two companies may join to form a new company, but there may be absorption or blending of one by the other, both amount to amalgamation. When two companies are merged and are so joined, as to form a third company or one is absorbed into one or blended with another, the amalgamating company loses its entity.” (iv) Fourthly, 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; (v) Fifthly, a notice under Section 143 (2) was issued on 26 September 2013 to the amalgamating company, SPIL, which was followed by a notice to it under Section 142(1); (vi) Sixthly, prior to the date on which the jurisdictional notice under Section 143 (2) was issued, the scheme of amalgamation had been approved on 29 January 2013 by the High Court of Delhi under the Companies Act 1956 with effect from 1 April 2012; (vii) Seventhly, the 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 in spite of the fact that on 2 April 2013, the amalgamated company MSIL had addressed a communication to the assessing officer intimating the fact of amalgamation. In the above conspectus of the facts, the initiation of assessment proceedings against an entity which had ceased to exist was void ab initio.

27 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., 20. In Spice Entertainment, a Division Bench of the Delhi High Court dealt with the question as to whether an assessment in the name of a 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 High Court held that upon a notice under Section 143 (2) being addressed, 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 name of the amalgamated company and proceeded to make an assessment in the name of a non-existent company which renders it void. This, in the view of the High Court, was not merely a procedural defect. Moreover, the participation by the amalgamated company would have no effect since there could be no estoppel against law: “11. After the sanction of the scheme on 11th April, 2004, the Spice ceases to exit w.e.f. 1st July, 2003. Even if Spice had filed the returns, it became incumbent upon the Income tax authorities to substitute the successor in place of the said „dead person‟. When notice under Section 143 (2) was sent, the appellant/amalgamated company appeared and brought this fact to the knowledge of the AO. He, however, did not substitute the name of the appellant on record. Instead, the Assessing Officer made the assessment in the name of M/s Spice which was non existing entity on that day. In such proceedings an assessment order passed in the name of M/s Spice would clearly be void. Such a defect cannot be treated as procedural defect. Mere participation by the appellant would be of no effect as there is no estoppel against law.

23. In Micra India, the original assessee Micra India Pvt. Ltd had amalgamated with Dynamic Buildmart (P) Ltd. Notice was issued to the original assessee by the Revenue after the fact of amalgamation had been communicated to it. The Court noted that though the assessee had participated in the assessment, the original assessee was no longer in existence and the assessment officer did not the take the remedial measure of transposing the transferee as the company which had to be assessed. Instead, the original assessee was described as one in existence and the order mentioned the transferee’s name below that of the original assessee. The Division Bench adverted to the judgment in Dimension Apparels wherein the High Court had discussed the ruling in Spice Entertainment. It was held that this was a case where the assessment was contrary to law, having been completed against a non-existent company.

25. The doctrine of merger results in the settled legal position that the judgment of the Delhi High Court stands affirmed by the above decision in the Civil Appeals.

30 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., “19. Petitioner relies on Spice Infotainment Ltd. v. Commissioner of Service Tax, (2012) 247 CTR 500 Spice Corp. Ltd., the company that had filed the return, had amalgamated with another company. After notice under Section 147/148 of the Act was issued and received in the name of Spice Corp. Ltd., the Assessing Officer was informed about amalgamation but the Assessment Order was passed in the name of the amalgamated company and not in the name of amalgamating company. In the said situation, the amalgamating company had filed an appeal and issue of validity of Assessment Order was raised and examined. It was held that the assessment order was invalid. This was not a case wherein notice under Section 147/148 of the Act was declared to be void and invalid but a case in which assessment order was passed in the name of and against a juristic person which had ceased to exist and stood dissolved as per provisions of the Companies Act. Order was in the name of non-existing person and hence void and illegal.”

31 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., defect or omission in such return of income, assessment, notice, summons or other proceeding if such return of income, assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the intent and purpose of this Act.” In this case, the notice under Section 143(2) under 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. In this context, it is necessary to advert to the provisions of Section 170 which deal with succession to business otherwise than on death. Section 170 provides as follows: “170. (1) 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 assesseed 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 assesseed 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. (3) When any sum payable under this section in respect of the income of such business or profession for the previous year in which the succession took place up to the date of succession or for the previous year preceding that year, assesseed on the predecessor, cannot be recovered from him, the 99[Assessing] Officer shall record a finding to that effect and the sum payable by the predecessor shall thereafter be payable by and recoverable from the successor and the successor shall be entitled to recover from the predecessor any sum so paid. (4) Where any business or profession carried on by a Hindu undivided family is succeeded to, and simultaneously with the succession or after the succession there has been a partition of the joint family property between the members or groups of members, the tax due in respect of the income of the business or profession succeeded to, up to the date of succession, shall be assesseed and recovered in the manner provided in section 171, but without prejudice to the provisions of this section. Explanation.—For the purposes of this section, “income” includes any gain accruing from the transfer, in any manner whatsoever, of the business or profession as a result of the succession”

32 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., Now, in the present case, learned Counsel appearing on behalf of the respondent submitted that SPIL ceased to be an eligible assessee in terms of the provisions of Section 144C read with clause (b) of sub section 15. Moreover, it has been urged that in consequence, the final assessment order dated 31 October 2016 was beyond limitation in terms of Section 153(1) read with Section 153 (4). For the purposes of the present proceeding, we do not consider it necessary to delve into that aspect of the matter having regard to the reasons which have weighed us in the earlier part of this judgment.

24. In the case on hand it is undoubtedly the assessment was made by the Assessing Officer on SIPSPL the amalgamating company which was 34 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., amalgamated with STSPL w.e.f 01.10.2011 and accordingly ceased to exist thereafter. Therefore, when the assessment was made on an non existing entity the said assessment is void ab-initio and nullity in the eye of law. Assessment framed against a non-existing entity goes to the root of the matter and it is not a procedural irregularity but a jurisdictional defect and there cannot be any assessment against a non-existing entity or a dead person. Therefore, the decision of the Hon'ble Supreme Court in the case of Pr.CIT v. Maruti Suzuki India Limited (supra) squarely applies to the facts of the assessee’s case. Respectfully following the decision of the Hon'ble Supreme Court, we hold that the assessment made by the Assessing Officer in the name of the amalgamating company i.e. SIPSPL dated 24.01.2014 u/s. 143(3) r.w.s. 144C(13) of the Act for the A.Y.2009-10 is void ab-initio and bad in law. Hence the assessment order is a nullity in the eye of law and the same is quashed. The additional ground raised by the assessee is allowed.

26. Since the Assessment Order dated 24.01.2014 passed u/s.143(3) r.w.s. 144C(13) of the Act for the A.Y. 2009-10 is quashed the Revenue’s appeal in ITA.No. 1887/MUM/2014 becomes infructuous and the same is dismissed as infructuous.

ITA.No. 1665/MUM/2015 (2010-11) (Assessee appeal) 27. Facts being identical, the decision taken therein for A.Y. 2009-10 applies mutatis mutandis for the A.Y. 2010-11. Thus, following our above order for the A.Y.2009-10, we hold that the Assessment Order dated 28.01.2015 passed u/s. 143(3) r.w.s. 144C(13) of the Act for the A.Y.2010-11 is a nullity in the eye of law and the same is quashed. The additional ground raised by the assessee is allowed.

ITA.No. 1779/MUM/2015 (Revenue appeal)

29. Since the Assessment Order dated 28.01.2015 passed u/s.143(3) r.w.s. 144C(13) of the Act for the A.Y. 2010-11 is quashed the Revenue’s appeal in ITA.No. 1779/Mum/2015 becomes infructuous and the same is dismissed as infructuous.

36 & 1887/MUM/2014 (A.Y: 2009-10) ITA NO. 1665 &1779/MUM/2015 (A.Y: 2010-11) M/s. Siemens Technology and Services Pvt. Ltd., 30. In the result, appeals of the assessee are partly allowed and appeals of the Revenue are dismissed.

Order pronounced in the open court on the 31st July, 2019.