Notices and proceedings initiated against amalgamated company is bad-in-law

Virchow Drugs Limited Vs ITO (Telangana High Court)

Telangana High Court has held that notices and proceedings initiated against the amalgamated Company (i.e. non-existing company) deserves to be set aside/quashed. Accordingly, entire proceedings held as bad-in-law.

Facts- The instant writ petition has been filed by the petitioner assailing the order passed by the respondent No.1/The Income Tax Officer u/s. 148A (d) of the Income Tax Act, 1961 for the assessment year 2016-2017 against Siri Drugs India Private Limited. The aforesaid company i.e. Siri Drugs India Private Limited since had got merged with the petitioner’s Company under the scheme of amalgamation with effect from 01.04.2015, the challenge is also to the consequence notice u/s. 148 of the Act.

Conclusion- Hon’ble Supreme Court in the case of PCIT vs. Maruti Suzuki (India) Limited has held that the notices and proceedings initiated against the amalgamated Company deserves to be set aside/quashed.

Held that the notice dated 24.03.2023 issued Section 148A(d) of the Act and the consequential notice of the same date i.e. 24.03.2023 under Section 148 of the Act, both being bad in law, are set aside, as the entire proceedings itself is against a non-existing Company.

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