OPTIMED P.LTD,NEW DELHI vs. ITO, WARD-19(2), NEW DELHI

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ITA 1586/DEL/2018Status: DisposedITAT Delhi29 August 2018AY 2009-107 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the notices under Section 148 of the Income-tax Act, 1961, were issued to a non-existent person, as both companies, Optimed Private Ltd and Olympus Infrastructure Pvt Ltd, had their names struck off and were dissolved by the Registrar of Companies prior to the issuance of the notices. The Tribunal reasoned that no assessment can be framed on a dead person. Therefore, the assessments framed in the case of the appellants were considered bad in law and deserved to be quashed. The ratio decidendi is that a legal entity that has been dissolved and struck off the register ceases to exist, and any subsequent legal proceedings, including income tax assessments, initiated against it are void ab initio. The operative direction was to quash the assessments.

What were the facts?

The appeals were filed by two distinct assessees, Optimed Private Ltd and Olympus Infrastructure Private Ltd, against orders of the CIT(A)-7, Noida, for assessment year 2009-10. The core issue revolved around the validity of assessments framed under Section 148/143(3) of the Income-tax Act, 1961. Notices under Section 148 were issued on 21.03.2016 for Optimed Private Ltd and on 22.03.2016 for Olympus Infrastructure Pvt Ltd. The Registrar of Companies had struck off the name of Optimed Private Limited on 30.01.2013 and dissolved the company. Similarly, the name of Olympus Infrastructure Pvt Ltd was struck off on 03.12.2013 and the company was dissolved. The assessees contended that the assessments were framed on a non-existent person.

What were the issues?

1. Whether the assessment framed under Section 148/143(3) of the Income-tax Act, 1961, is valid when the notices were issued to a company whose name was struck off and dissolved by the Registrar of Companies prior to the issuance of the notices? (Question of law and fact, turning on Section 148 and Section 143(3)). Assessee's Contention: The assessment is invalid because it was framed on a non-est person, i.e., a company that no longer legally existed. The notices under Section 148 were issued after the companies were dissolved. Revenue's Contention: The judgment records no specific contention from the revenue regarding the validity of the assessment in light of the companies being struck off.

Which sections of the Income-tax Act were involved?

Section 148,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI ‘A-SMC’ BENCH,

Before: SHRI N.K. BILLAIYA, & SHRI KULDIP SINGH

For Appellant: Shri Ajay Mankotia, Adv
Hearing: 28.08.2018

Heard together (2 matters)

ITA No. 1586/DEL/2018
ITA No. 1584/DEL/2018

Read from the judgment's own cause title. This page is filed under one of them.

PER N.K. BILLAIYA, ACCOUNTANT MEMBER,

1.

These two appeals by two distinct assessees are preferred against two separate orders of the Commissioner of Income Tax [Appeals]-7, Noida dated 30.11.2017 pertaining to assessment year 2009-10. Since common grievance is involved in both these appeals, they were heard together for the sake of convenience.

The appellants have raised as many as 9 substantive 2. grounds in their respective appeals. Vide Ground No. 7, the appellants have challenged the validity of the assessment framed u/s 148/143(3) of the Income-tax Act, 1961 on the ground that the assessment has been framed on a non-est person.

3.

Facts on record show that in 148 of the Act was issued on 21.03.2016 and in the notice u/s 148 of the Act was issued on 22.03.2016.

3 4. Records of the Registrar of Companies have struck off the name of Optimed Private Limited vide order dated 30.01.2013 and the same reads as under:

“GOVERNMENT OF INDIA MINISTRY OF CORPORATE AFFAIRS Office of the Registrar of Companies 4th Floor, IFCI Tower, 61, Nehru Place , New Delhi 110019, Date: 30/01/2013

In the matter of the Companies Act, 1956 and of M/s OPTI MED PRIVATE LIMITED, U74899DL2006PTC144430 This is with respect to your application (Form FTE) dated 23/11/2012 vide SRN B62291059.

Notice is hereby given pursuant to sub section (5) of Section 560 of the Companies Act. 1956, that the name of OPTI MED PRIVATE LIMITED has this day been struck off the Register and the said Company is dissolved.

Rajneesh Kumar Singh Assistant Registrar of Companies Registrar of Companies , National Capital Territory of Delhi and Haryana Copy forwarded to:

4 1. The Manager, Government of India Press, Faridabad for publication in Part III Sector 1 of the Gazette of India 2. The Income Tax Officer Company Circle Number”

Mailing Address as per record available in Registrar of Companies office: OPTI MED PRIVATE LIMITED E 186GREATER KAILASH I, NEW DELHI-110048, Delhi, INDIA.”

5.

The name of Olympus Infrastructure Pvt Ltd was struck off on 03.12.2013. The order reads as under:

“GOVERNMENT OF INDIA MINISTRY OF CORPORATE AFFAIRE Office of the Registrar of Companies 4th Floor, IFCI Tower. 61, -Nehru Place, New Delhi - 110019,

Date 03/12/2013

In the matter of the Companies Act, 1956 and of M/s OLYMPUS INFRASTRUCTURE PRIVATE LIMITED U45200DL2006PTC154055 This is with respect to your application (Form FTE) dated 03/07/2013 vide SRN B78525938.

Notice is hereby given pursuant to sub section (5) of Section 560 of the Companies Act. 1956 that the name of OLYMPUS

5 INFRASTRUCTURE PRIVATE LIMITED limited has this day been struck off the Register and the said Company is dissolved.

PREMLAL BHANJURAM MALIK Deputy Registrar of Companies Registrar of Companies , National Capital Territory of Delhi and Haryana

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