Vinpack Agro Pvt. Ltd. Vs ITO (ITAT Ahmedabad)
The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench, has set aside a tax assessment order against Vinpack Agro Pvt. Ltd., ruling that the entire assessment proceeding was void-ab-initio because the company had been struck off the Registrar of Companies before the tax notice was issued. The tribunal’s decision reinforces the legal principle that a notice cannot be validly served on a “dead” or non-existent entity.
The case pertains to the assessment year 2010-11. The Assessing Officer (AO) had reopened the assessment for Vinpack Agro Pvt. Ltd. based on information from the non-filer monitoring system, which revealed significant financial transactions. The information included transactions amounting to over ₹64 lakh for the purchase of mutual fund units and contract receipts of nearly ₹2 lakh. The AO, believing that taxable income had escaped assessment, issued a notice under Section 148 of the Income Tax Act, 1961, on March 28, 2017.
The tax authorities attempted to serve the notice via email and later through affixture at the company’s last known address. Despite the company’s subsequent communication stating that it was no longer operational, it failed to file a return of income. The AO, therefore, proceeded with a best judgment assessment under Section 144 of the Act. The AO made an addition of ₹40 lakh, treating it as an unexplained investment, and added the contract receipts of ₹1,93,929 to the company’s income.
