SPLENDID ENTERPRISES PVT. LTD.,NEW DELHI vs. PR. CIT, NEW DELHI

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ITA 1770/DEL/2016Status: DisposedITAT Delhi12 September 2018AY 2012-134 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the amalgamation fact was not properly considered in the assessment order and the revisionary order was passed without affording a proper opportunity to the assessee. Therefore, the matter was remanded back to the Pr. CIT.

What were the facts?

The assessee company, Gaganeet Paper & Plastics Pvt. Ltd., amalgamated with Splendid Enterprises Pvt. Ltd. effective from April 1, 2012. This fact was brought to the Assessing Officer's notice, but the assessment order and subsequent revisionary order by the Pr. CIT did not reflect this. The assessee argued the revisionary order was passed ex parte and against a non-existent entity.

What were the issues?

Whether a revisionary order under Section 263 is valid if passed ex parte and without considering the fact of amalgamation of the assessee company? Whether the revisionary order is sustainable when passed against a non-existent entity due to amalgamation?

Which sections of the Income-tax Act were involved?

Section 263,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘E’, NEW DELHI

Before: SMT. DIVA SINGH & SH. O.P. KANT

Hearing: 21.08.2018Pronounced: 12.09.2018

PER DIVA SINGH, J.M.: The present appeal has been filed by the assessee assailing the correctness of the order dated 14.03.2016 of Principal Commissioner of Income Tax, Delhi-4, New Delhi, pertaining to assessment year 2012-13. 2. Both the parties were heard in respect of ground no. 4 raised by the assessee in the present appeal, the same reads as under:

1.

“4. That on the facts and the circumstances of the case and the provisions of law, the Revisionary order passed u/s 263 of the Income Tax Act, 1961 is against the principles of natural justice and the same has been passed without affording reasonable and adequate opportunity of being heard and without issuing proper show cause notice to the appellant company.”

3.

Learned AR, inviting our attention to the impugned order, submitted that the order passed by the Pr. CIT is ex parte. Addressing the assessment order it was submitted that the assessment order, which is sought to be revised, is an order in the case of the assessee which does not exist on that date. Accordingly, it was submitted that a revisionary order against a nonest order cannot stand in the eyes of law. Inviting attention to paper book filed, it was his submission that the assessee company had amalgamated with M/s. Splendid Enterprises Pvt. Ltd. vide order dated 14th August, 2013 under Section 391 to 394 of the Companies Act by the order of the Hon’ble High Court. The said fact was brought to the notice of the Assessing Officer by letter dated 21.05.2014, copy of which is available at paper book pages 27 and 28. Inviting attention to the assessment order dated 27th June, 2014, it was his submission that the Assessing Officer has failed to take note of the said fact. The learned AR was required to address whether this fact has been brought to the notice of the Pr. CIT, Delhi-4, New Delhi or not. Learned AR submitted that the order is passed ex parte as the assessee never received any notices. However, it was his submission that since one of the discrepancies pointed out by Pr. CIT makes a reference to legal and professional charges pertaining to drafting of amalgamation and merger of Rs.25 lakhs, the said fact may have been noticed by him, however, the assessee has submitted that it was not correctly brought on record.

4.

The learned Sr. DR, on a perusal of the record, submitted that he would have no objection if the order is remanded and is passed after hearing the assessee; however, whether the said letter stated to be made to the Assessing Officer on 21.05.2014, was available on record, cannot be addressed without having a look at the Assessing Officer’s folder. Accordingly, a remand was requested. 5. We have heard the rival submissions and perused the material on record. It is noticed that the assessee Splendid Enterprises Pvt. Ltd., New Delhi, filed return of income on 16.08.2012 in the name of M/s. Gaganeet Paper & Plastics Pvt. Ltd. and notices and questionnaires etc. were issued in

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