Case Law Details
Chemester Food Industries Pvt. Ltd Vs PCIT (ITAT Delhi)
ITAT Delhi held that assessment order framed in the name of a non-existing entity is non-est and liable to be quashed. Accordingly, initiation of proceedings u/s 263 based on such assessment order is liable to be set aside.
Facts- This appeal by the assessee is directed towards the order of the PCIT-2 framed u/s 263 of the Income-tax Act, 1961. The Appellant disputes the very initiation of the proceedings u/s 263 of the Income Tax Act, 1961 by Ld. CIT by setting aside assessment orders passed by the Ld. AO u/s 143(3), despite Pr. CIT having himself admitted in the notice issued u/s 263 that the Appellant had filed loan confirmation, bank statement and return of income of lenders to substantiate their genuineness and creditworthiness during the original assessment proceedings u/s 143(3).
Further, appellant also contested that initiation of proceedings u/s 263 against M/s. Chemester Food Industry which was non-existing firm.
Conclusion- The Hon’ble Supreme Court in the case of Maruti Suzuki India Ltd has held that issuance of jurisdictional notice and assessment order thereafter passed in the name of non-existing company i.e. amalgamating company having ceased to exist as a result of approved scheme of amalgamation is a substantive illegality and not a procedural violation of nature adverted to in section 292B and hence being without jurisdiction was to be set aside.
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