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“scheme of arrangement”

Mergers & RestructuringSection 391-394Section 391-394328 judgments

The decision most relied on for scheme of arrangement is Spice Infotainment Ltd. v. CIT (247 CTR 500), cited in 114 judgments on BharatTax.

Leading authorities on scheme of arrangement

Spice Infotainment Ltd. v. CIT
247 CTR 500 · 2012 · High Court
114
citing judgments

An assessment framed in the name of a company that has ceased to exist due to amalgamation is invalid, even if the amalgamated company participated in the proceedings. Such a defect cannot be cured under section 292B of the Income-tax Act.

Saraswati Industrial Syndicate Ltd. v. CIT
186 ITR 278 · 1990 · Supreme Court
79
citing judgments

Upon amalgamation, the amalgamating company ceases to exist in the eyes of the law. Therefore, any assessment or proceeding initiated against a non-existent amalgamating company is invalid as it is no longer considered a 'person' under the Income-tax Act.

CIT v. Intel Technology India (P.) Ltd.
380 ITR 272 · 2016 · High Court
45
citing judgments

When an amalgamating company ceases to exist due to a scheme of arrangement or merger, any subsequent assessment or action under the Income-tax Act initiated against that non-existent entity is void ab initio, as it is not a 'person' under Section 2(31).

CIT v. Smifs Securities Ltd.
87 Taxmann.com 82 · 2017 · High Court
38
citing judgments

Depreciation is allowable on goodwill as an intangible asset under Section 32(1)(ii) when it arises from a scheme of amalgamation or similar corporate restructuring.

Rustagi Engineering Udyog (P.) Ltd. v. Deputy Commissioner of Income-tax
382 ITR 443 · 2016 · High Court
25
citing judgments

An amalgamation that has been brought to the notice of the Assessing Officer is void ab initio, meaning it is invalid from the beginning.

DCIT v. Toyo Engineering India ltd.
33 Taxmann.com 560 · 2013 · Reported
22
citing judgments

Depreciation is not allowed on goodwill if it arises from book entries and has no identifiable cost of acquisition. This applies even when goodwill is acquired as part of a scheme of arrangement or amalgamation.

Dalmia Power Ltd. v. ACIT
420 ITR 339 · 2020 · Supreme Court
21
citing judgments

Once a scheme of arrangement or amalgamation has been sanctioned by a competent court and due notice has been issued to the income tax department, the binding nature of the scheme cannot be challenged during its implementation, as it attains statutory force.

Killick Nixon Ltd. v. Deputy Commissioner of Income-tax
20 Taxmann.com 703 · 2012 · High Court
20
citing judgments

Transactions lacking commercial substance, such as circular share transactions designed to generate artificial capital losses, are not genuine and may be disregarded by tax authorities.

Judgments citing scheme of arrangement

Shiva Pharmachem Limited, Vadodara vs. Deputy Commissioner of Income Tax, Circle 2(1)(1), Vadodara

In the result, the appeal of the Assessee is allowed

ITA 698/AHD/2023[2021-2022]Status: DisposedITAT Ahmedabad04 Jul 2024AY 2021-2022

Bench: Ms. Suchitra Kamble & Shri Makarand V. Mahadeokar, Accountnat Member Assessment Year : 2021-22 Shiva Pharmachem Limited The Dy.Cit Shiva 12Th Floor, Vs Circle-2(1)91) Opp. Tricolour Hospital Vadodara Genda Circle, Vadodara-390 023 (Gujarat) Pan: Aajcs 3940 B अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Shri Sunil Talati, Ar Revenue By : Shri Sudhakar Verma, Sr.Dr सुनवाई क" तार"ख/Date Of Hearing : 01/07/2024 घोषणा क" तार"ख /Date Of Pronouncement: 04/07/2024 आदेश/O R D E R Per Shri Makarand V. Mahadeokar, Am: This Appeal By Assessee Is Filed Against The Order Of Commissioner Of Income Tax (Appeals) – National Faceless Appeal Centre – Delhi [Hereinafter Referred To As “The Ld.Cit(A)”] Passed On 24/07/2023 U/S. 250 Of The Income Tax Act,1961 (Hereinafter Referred To As “The Act”) Instituted Against The Order Dated 19/12/2022 Passed By The Assistant Director Of Income Tax, Cpc, Under Section 154 Of The Income-Tax Act, 1961, For The Assessment Year (Ay) 2021-22. Facts Of The Case: Shiva Pharmachem Liimited Vs. The Dcit Asst. Year 2021-22:

For Appellant: Shri Sunil Talati, ARFor Respondent: Shri Sudhakar Verma, Sr.DR
Section 154Section 230Section 250

M/s.Shiva Pharmachem Limited, filed its original return on 09/02/2022 declaring a total income of Rs.64,88,10,170/-. The assessee entered into a scheme of arrangement under sections 230 to 232 of the Companies Act, 2013, with M/s.Tash Investment Pvt. Ltd., as approved by the NCLT order dated 10th September ... Shiva Pharmachem Liimited vs. The DCIT Asst. Year 2021-22: ii) For the year, the appellant Company M/s Shiva Pharmachem Limited entered into schemes of arrangement under section 230 to 232 of the Companies Act 2013 with M/s Tash Investment Pvt. Ltd. vide NCLT Order dated 10th September

ACIT Cir 7(1), Mumbai vs. Novartis India ( Formelry Known As Hindustan Ciba Giegy Ltd), Mumbai

In the result, (i) the appeal filed by the assessee is partly allowed for statistical purpose (ii) the appeal filed by the revenue is dismissed and (iii) the Cross Objections filed by the assessee ...

ITA 2188/MUM/2012[2003-04]Status: DisposedITAT Mumbai28 May 2024AY 2003-04

Bench: Pavan Kumar Gadale & Shri Girish Agrawal & Co 76/Mum/2013 (A.Y 2003-04) Novartis India Limited Vs. Deputy Commissioner Of Income–Tax–14(1)(1) Inspire Bkc, 7Th Floor, Room No 432, Bandra Kurla Complex, Aaykar Bhawan, Bandra (E) M.K. Marg, Mumbai-400051. Mumbai-400020. Pan/Gir No. Aaach2914F (अपीलाथ"/Appellant) (""यथ"/Respondent) Deputy Commissioner Vs. Novartis India Limited Of Income–Tax–14(1)(1) Inspire Bkc, 7Th Floor, Room No 432, Bandra Kurla Complex, Aaykar Bhawan, Bandra (E) M.K. Marg, Mumbai-400051 Mumbai-400020 Pan/Gir No. Aaach2914F (अपीलाथ"/Appellant (""यथ"/Respondent)

Section 37(1)Section 41(3)Section 80H

Assessing Officer(A.O),On the first disputed issue in respect of transfer of assets to M/s Ciba speciality Chemicals (India) Ltd under the scheme of arrangement sanctioned by the Bombay High Court, find that the assessee company has transferred its fixed assets pertaining to the Speciality Chemicals business ... Ciba Speciality Chemicals Ltd as per Schedule A to the scheme of arrangement, whereas in the course of assessment proceedings of the A.Y 1997-98, for the purpose of claiming deprecation under the Income Tax Act the assessee company has not reduced from its block of assets, the value

DCIT, CC-7(2), Mumbai vs. M/S. Patanjali Foods Ltd., ( Formerly Known As Ruchi Soya Industries Ltd, Mumbai

In the result, the appeal and cross objections of the assessee are

ITA 1176/MUM/2023[2012-13]Status: DisposedITAT Mumbai05 Apr 2024AY 2012-13

Bench: Shri Aby T. Varkey, Jm & Shri S Rifaur Rahman, Am आयकर अपील सं/ I.T. A. No. 1172/Mum/2023 (निर्धारण वर्ष / Assessment Year: 2010-11) & आयकर अपील सं/ I.T. A. No. 1175/Mum/2023 (निर्धारण वर्ष / Assessment Year: 2012-13) & आयकर अपील सं/ I.T. A. No. 1176/Mum/2023 (निर्धारण वर्ष / Assessment Year: 2012-13) Dcit, Central Circle-7(2) Room No. 637, 6Th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. बनाम / M/S. Patanjali Foods Ltd Vs. (Formerly Known As Ruchi Soya Industries Ltd) 616, Tulsiani Chambers, Nariman Point, Mumbai- 400021. Cross Objection No.51/Mum/2023 (Arising Out Of I.T. A. No. 1172/Mum/2023) (निर्धारण वर्ष / Assessment Year: 2010-11) M/S. Patanjali Foods Ltd (Formerly Known As Ruchi Soya Industries Ltd) 616, Tulsiani Chambers, Nariman Point, Mumbai- 400021. बनाम / Dcit, Central Circle-7(2) Vs. Room No. 637, 6Th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. & आयकर अपील सं/ I.T. A. No. 320/Mum/2023 (निर्धारण वर्ष / Assessment Year: 2012-13) M/S. Patanjali Foods Ltd (Formerly Known As Ruchi Soya Industries Ltd) बनाम / Vs. Dcit, Central Circle-7(2) Room No. 637, 6Th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. 616, Tulsiani Chambers, Nariman Point, Mumbai- 400021. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaaci1220M 2

For Appellant: Shri S. S. Nagar & Shri BFor Respondent: Dr. Mahesh Akhade (DR)
Section 132Section 143(2)Section 153A

issue are that, during the year, M/s Mac Oil Palm Limited had amalgamated with the assessee. In terms of the approved Scheme of Arrangement, certain debtors and advances of the amalgamating company, which were found to be unrealizable, were directly adjusted from the General Reserve ... given by the auditor is extracted below: "Without qualifying our opinion, attention is drawn to Note 5 of Schedule 20 relating to the Scheme of Arrangement and 43 ITA No.1172, 1175 & 1176/M/2023 ITA. No.320/Mum/2023 & CO No. 51/Mum/2023 A.Y Nos. 2010-11 & 2012-13 M/s. Patanjali Foods Ltd. Arrangement between

DCIT, CC-7(2), Mumbai vs. M/S. Patanjali Foods Ltd., ( Formerly Known As Ruchi Soya Industries Ltd, Mumbai

ITA 1175/MUM/2023[2012-13]Status: DisposedITAT Mumbai05 Apr 2024AY 2012-13

Bench: Shri Aby T. Varkey, Jm & Shri S Rifaur Rahman, Am आयकर अपील सं/ I.T. A. No. 1172/Mum/2023 (निर्धारण वर्ष / Assessment Year: 2010-11) & आयकर अपील सं/ I.T. A. No. 1175/Mum/2023 (निर्धारण वर्ष / Assessment Year: 2012-13) & आयकर अपील सं/ I.T. A. No. 1176/Mum/2023 (निर्धारण वर्ष / Assessment Year: 2012-13) Dcit, Central Circle-7(2) Room No. 637, 6Th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. बनाम / M/S. Patanjali Foods Ltd Vs. (Formerly Known As Ruchi Soya Industries Ltd) 616, Tulsiani Chambers, Nariman Point, Mumbai- 400021. Cross Objection No.51/Mum/2023 (Arising Out Of I.T. A. No. 1172/Mum/2023) (निर्धारण वर्ष / Assessment Year: 2010-11) M/S. Patanjali Foods Ltd (Formerly Known As Ruchi Soya Industries Ltd) 616, Tulsiani Chambers, Nariman Point, Mumbai- 400021. बनाम / Dcit, Central Circle-7(2) Vs. Room No. 637, 6Th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. & आयकर अपील सं/ I.T. A. No. 320/Mum/2023 (निर्धारण वर्ष / Assessment Year: 2012-13) M/S. Patanjali Foods Ltd (Formerly Known As Ruchi Soya Industries Ltd) बनाम / Vs. Dcit, Central Circle-7(2) Room No. 637, 6Th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. 616, Tulsiani Chambers, Nariman Point, Mumbai- 400021. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaaci1220M 2

For Appellant: Shri S. S. Nagar & Shri BFor Respondent: Dr. Mahesh Akhade (DR)
Section 132Section 143(2)Section 153A

issue are that, during the year, M/s Mac Oil Palm Limited had amalgamated with the assessee. In terms of the approved Scheme of Arrangement, certain debtors and advances of the amalgamating company, which were found to be unrealizable, were directly adjusted from the General Reserve ... given by the auditor is extracted below: “Without qualifying our opinion, attention is drawn to Note 5 of Schedule 20 relating to the Scheme of Arrangement and Arrangement between Mac Oil Palm Limited and the Company and their respective shareholders sanctioned by the Hon'ble High Court of Mumbai