KAMUTHI SOLAR POWER LIMITED (MERGED WITH ADANI GREEN ENERGY TWENTY -THREE LTD.),AHMEDABAD vs. THE PR. CIT, AHMEDABAD-1, AHMEDABAD

ITA 1242/AHD/2025Status: DisposedITAT Ahmedabad13 February 2026AY 2020-21Bench: DR. B.R.R. KUMAR, VICE-PRESIDENT SHRI SIDDHARTHA NAUTIYAL (Judicial Member)5 pages
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What did the Tribunal hold?

The Tribunal ruled that the PCIT's order passed under Section 263 against Kamuthi Solar Power Limited was void ab initio because the company had already ceased to exist due to amalgamation before the order was issued. The Tribunal noted that this fact was known to the PCIT, and relied on Supreme Court precedents establishing that orders against non-existent entities are substantively illegal.

What were the facts?

Kamuthi Solar Power Limited, engaged in solar power generation, filed its revised return declaring Nil income after setting off carbon credit income against business losses, and the assessment was completed as Nil. The PCIT issued a notice under Section 263, proposing to revise the assessment regarding alleged cessation of liability/bad debts and taxability of carbon credits, and subsequently set aside the assessment. The assessee contended that it had amalgamated with Adani Green Energy Twenty Three Ltd. and ceased to exist prior to the PCIT's order, a fact communicated to the PCIT.

What were the issues?

Whether a revisionary order passed by the PCIT under Section 263 of the Income Tax Act, 1961, against an amalgamated company that has ceased to exist, is valid in law.

Which sections of the Income-tax Act were involved?

Section 263,Section 115BBG,Section 143(3),Section 144B

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Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD

For Appellant: Shri Biren Shah, AR
For Respondent: Shri R.P. Rastogi, CIT-DR
Hearing: 10.12.2025Pronounced: 13.02.2026

PER DR. B.R.R. KUMAR, VICE-PRESIDENT:

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This appeal has been filed by the assessee against the order passed by the Ld. Principal Commissioner of Income-tax, Ahmedabad (hereinafter referred to as "PCIT" for short), dated 08.03.2025, in exercise of his revisionary powers under Section 263 of the Income-tax Act, 1961 [hereinafter referred to as “the Act”], for the Assessment Year (AY) 2020-21. 2. The assessee has raised the following grounds of appeal:-

“1 In law and in the facts and the circumstances of the case of the appellant, the order u/s 263 of the Act passed by Ld. PCIT is bad in law and deserves to be quashed.

2.

In law and in the facts and the circumstance

The order continues below.

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