HCL Infosystems Ltd Vs DCIT (ITAT Delhi)
The Income Tax Appellate Tribunal (ITAT), Delhi, considered an appeal filed against the order dated 16.07.2019 passed by the Commissioner of Income Tax (Appeals) for Assessment Year 2006-07. The dispute arose from an assessment order dated 07.12.2018 passed under Sections 143(3), 254, and 250 of the Income Tax Act.
The original return of income was filed by HCL Infinet Ltd. declaring income of Rs. 2,30,72,99,650 on 15.03.2007. The assessment was completed on 30.12.2008 with additions leading to assessed income of Rs. 2,32,45,33,297. Subsequently, the first appellate proceedings were decided on 01.08.2013. Later, the Tribunal, by order dated 26.05.2017, deleted certain disallowances and remanded the issue relating to addition of creditor balances amounting to Rs. 49,25,160. It also directed that license fee at 6% of turnover be allowed as revenue expenditure.
Following the remand, the Assessing Officer issued notices in August, September, and October 2018 in the name of HCL Infinet Ltd. The assessee responded on 05.11.2018 stating that HCL Infinet Ltd. had already merged with HCL Infosystems Ltd. pursuant to a Delhi High Court order dated 20.03.2007 approving the scheme of amalgamation with effect from 01.04.2006. According to the assessee, HCL Infinet Ltd. had ceased to exist and therefore the proceedings initiated against it were without jurisdiction. Despite this information, the Assessing Officer passed the assessment order dated 07.12.2018 in the name of HCL Infinet Ltd., which the assessee described as a non-existent entity.
