Dragon Builders & Developers LLP Vs ITO (ITAT Delhi)
Introduction: In the case of Dragon Builders & Developers LLP vs. ITO, the Income Tax Appellate Tribunal (ITAT) Delhi examined the consequences of issuing a jurisdictional notice in the name of a non-existing entity. This article explores the legal intricacies and implications of this decision.
The Hon’ble bench held that when a private limited company has been converted into an LLP and this fact is duly conveyed to the ld. AO during the reassessment proceedings vide the objections filed to reasons recorded, then the notice issued u/s 148 in the name of non existing company leads to quashing of the reassessment proceedings as this jurisdictional defect is not curable u/s 292B of the Income Tax Act, 1961. Reliance has been placed on the Supreme Court Judgement in the case of Maruti Suzuki India Ltd reported in 416 ITR 613 (SC).
Facts of the case
A private limited company got converted into an LLP on 14.02.2015. This fact was intimated to the jurisdictional AO on 24.02.2016. A notice was issued u/s 148 consequent to some information received from the Investigation wing on 31.03.2018 in the name of erstwhile private limited company. The said fact was also brought to the notice of the ld. AO while filing the objections to the reasons recorded. However, the ld. AO chose to continue with the jurisdictional defect and proceeded with the reassessment.
