DCIT, LUDHIANA vs. M/S RELIGARE TECHNOVA IT SERVICES LTD., NEW DELHI

आयकर अपीलीय अिधकरण,च"डीगढ़ "यायपीठ “ए” , च"डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “A”, CHANDIGARH HEARING THROUGH: PHYSICAL MODE "ी आकाश दीप जैन, उपा"य" एवं "ी िव"म "सह यादव, लेखा सद"य BEFORE: SHRI. AAKASH DEEP JAIN, VP & SHRI. VIKRAM SINGH YADAV, AM आयकर अपील सं./ ITA NO. 622/Chd/2017 िनधा"रण वष" / Assessment Year : 2008-09 Healthfore Technologies Ltd. बनाम The DCIT (Formerly Religare Technologies Circle VII Ltd.) (Successor in interest to M/s Ludhiana Religare Technova IT Services Ltd.) Admn. Office: G-16, Marina Arcade, Connaught Circus, New Delhi- 110001 "थायी लेखा सं./PAN NO: AACCP0505H अपीलाथ"/Appellant ""यथ"/Respondent आयकर अपील सं./ ITA NO. 656/Chd/2017 िनधा"रण वष" / Assessment Year : 2008-09 The DCIT बनाम Healthfore Technologies Ltd. Circle VII (Formerly Religare Technologies Ludhiana Ltd.) (Successor in interest to M/s Religare Technova IT Services Ltd.) Admn. Office: G-16, Marina Arcade, Connaught Circus, New Delhi- 110001 "थायी लेखा सं./PAN NO: AACCP0505H अपीलाथ"/Appellant ""यथ"/Respondent िनधा"रती क" ओर से/Assessee by : None (Written Submission) राज"व क" ओर से/ Revenue by : Shri Rohit Sharma, CIT DR सुनवाई क" तारीख/Date of Hearing : 06/03/2024 उदघोषणा क" तारीख/Date of Pronouncement : 14/03/2024 आदेश/Order PER VIKRAM SINGH YADAV, A.M. :

These are cross appeals filed by the Assessee and the Revenue against the order of the Ld. CIT(A)-3, Ludhiana dt. 20/01/2017 pertaining to Assessment Year 2008-09. 2. None has appeared on behalf of the assessee, however, a communication dt. 05/03/2024 was received by the Registry and has been placed on record wherein it has been submitted, on behalf of the assessee company, that there is no activity in the assessee company and it is neither in a position to appoint an Advocate to represent the matter nor to afford their professional fee and it was accordingly requested to decide the matter based on merits already elucidated in the chart and the paper books submitted.

“4. That on facts and in law, the CIT(A) failed to appreciate that the Order passed by the AO in the name of M/s Religare Technova IT Services Ltd. on 24th December, 2010 was not sustainable in law since it was passed in the name of the company which had already been amalgamated with the company viz. M/s Religare Technologies Ltd. (Now known as M/s Healthfore Technologies Ltd.) vide Order of the Hon’ble High Court of Delhi dated 28th July, 2010 and the aforesaid fact had been duly submitted before the CIT(A) alongwith copy of Order of the Hon’ble High Court of Delhi. The CIT(A) failed to appreciate that the Order of the AO was void ab initio and therefore ought to have been quashed.”

Thereafter notice under section 143(2) and 142(1) were issued on 26/05/2010 and served upon the assessee company on 27/05/2010. Thereafter the case was transferred to Circle-7, Ludhiana on 22/09/2010 and another notice under section 143(2) was issued on 20/10/2010 and served on the assessee company on 21/10/2010. 4.1 It was further submitted that from the perusal of the assessment order, it is apparent that though the representative of the assessee company attended to the proceedings except for responding to the show-cause dated 18/12/2010, there was however, no communication or any intimation to the AO by the assessee company as to the amalgamation of the assessee company with M/s Religare Technologies Ltd. Further, the assessment order is silent about the fact of the amalgamation of the assessee company with Religare Technologies Ltd. as approved by the Hon’ble Delhi High Court vide its order dt. 28/07/2010 as so claimed by the assessee company. It was accordingly submitted that there was no intimation or any communication by the assessee company to the AO and therefore in such circumstances given the material available on the record where the proceedings have been rightly initiated in the name of the assessee company which was in existence at the relevant point in time and under the PAN which was still operative, where the assessee company through its representative attended to the proceedings, the AO has rightly proceeded and completed the assessment by passing the order under section 143(3) dt. 24/12/2010 and there was thus no infirminity or illegality in the order so passed by the AO.

taxmann.com 91 (SC) and submitted that the facts of the said case are pari- materia and therefore, ratio laid down therein shall apply equally in the instant case. It was accordingly submitted that there is no merit in the contentions so raised on behalf of the assessee company and the ground of appeal so taken be dismissed.

“41. In the light of the facts, what is overwhelmingly evident- is that the amalgamation was known to the assessee, even at the stage when the search and seizure operations took place, as well as statements were recorded by the revenue of the directors and managing director of the group. A return was filed, pursuant to notice, which suppressed the fact of amalgamation; on the contrary, the return was of MRPL. Though that entity ceased to be in existence, in law, yet, appeals were filed on its behalf before the CIT, and a cross appeal was filed before ITAT. Even the affidavit before this court is on behalf of the director of MRPL. Furthermore, the assessment order painstakingly attributes specific amounts surrendered by MRPL, and after considering the special auditor’s report, brings specific amounts to tax, in the search assessment order. That order is no doubt expressed to be of MRPL (as the assessee) - but represented by the transferee, MIPL. All these clearly indicate that the order adopted a particular method of expressing the tax liability. The AO, on the other hand, had the option of making a common order, with MIPL as the assessee, but containing separate parts, relating to the different transferor companies (Mahagun Developers Ltd., Mahagun Realtors Pvt. Ltd., Universal Advertising Pvt. Ltd., ADR Home Décor Pvt. Ltd.). The mere choice of the AO in issuing a separate order in respect of MRPL, in these circumstances, cannot nullify it. Right from the time it was issued, and at all stages of various proceedings, the parties concerned (i.e., MIPL) treated it to be in respect of the transferee company (MIPL) by virtue of the amalgamation order – and Section 394 (2). Furthermore, it would be anybody’s guess, if any refund were due, as to whether MIPL would then say that it is not entitled to it, because the refund order would be issued in favour of a non-existing company (MRPL). Having regard to all these reasons, this court is of the opinion that in the facts of this case, the conduct of the assessee, commencing from the date the search took place, and before all forums, reflects that it consistently held itself out as the assessee. The approach and order of the AO is, in this court’s opinion in consonance with the decision in Marshall & Sons (supra), which had held that: “an assessment can always be made and is supposed to be made on the Transferee Company taking into account the income of both the Transferor and Transferee Company.”

Act, 1956 (and its equivalent in the 2013 Act), but would depend on the terms of the amalgamation and the facts of each case.

and more so, the findings of the ld CIT(A), we deem it appropriate that the matter be set-aside to the file of the ld CIT(A) to examine the same afresh as per law after providing reasonable opportunity to the assessee. The ld CIT(A) shall consider and take into considerations various authorities relied on by the assessee company as well as the decision of the Hon’ble Supreme Court referred supra. In the result, the ground no. 4 is allowed for statistical purposes.

आदेशानुसार/ By order, सहायक पंजीकार/