PR. COMMISSIONER OF INCOME TAX, CENTRAL - 2 vs. M/S XENIAL INVESTMENTS PVT. LTD. THROUGH IP INDIA PVT. LTD. (NOW KNOWN AS ADHUNIK TECHNOLOGY PVT. L

ITA-1168/2017 Page 1

$~47 * IN THE HIGH COURT OF DELHI AT NEW DELHI +

ITA 1168/2017, CM APPL.46241/2017

PR. COMMISSIONER OF INCOME TAX, CENTRAL - 2 ..... Appellant Through: Mr. Zoheb Hossain, Sr. Standing Counsel.

versus

M/S XENIAL INVESTMENTS PVT. LTD. THROUGH: IP INDIA PVT. LTD. (NOW KNOWN AS ADHUNIK TECHNOLOGY PVT. LTD.)

..... Respondent

Through: None.

CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE A.K. CHAWLA

O R D E R %

19.12.2017

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 2004- 05. 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,

ITA-1168/2017 Page 2

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 CIT v. Spice Entertainment (ITA No.475 of 2011) and CIT v. Dimension Apparel, 370 ITR 288, the ITAT upheld the CIT (A)’s decision and held that the assessment was a nullity.

The revenue urges in support of its appeal that the distinguishing feature of this case is that after repeated remand, the AO completed the assessment after noticing that the matter had been centralized under Section 127 and further taken care to mention the name of the merged or amalgamated entity, i.e., Adhunik Technology Pvt. Ltd.

In the opinion of the Court, the settled position indicated arising from the string of judgment, i.e., Spice Entertainment (supra) onwards till CIT v. Vivid Marketing Services (P) Ltd. (ITA No.273 of 2009), is in no way distinguishable. The rationale for holding that even Section 292B is inapplicable in all these cases consistently was that once the corporate entity is merged with another, i.e., transferee corporation or entity, the assessment had to be completed in the latter’s hands. In the present case, the revenue despite being intimated did not complete the assessment in a composite manner in the hands of the Adhunik Technology Pvt. Ltd. Clearly they were notified about the development as the assessee was duty bound to.

ITA-1168/2017 Page 3

Despite that, the Revenue persisted in completing a separate assessment order in respect of an entity which was not in existence.

For these reasons, following the previous reasons, it is held that no question of law arises; the appeal is, therefore, dismissed.

S. RAVINDRA BHAT, J

A.K. CHAWLA, J DECEMBER 19, 2017 /vikas/