S. 143(3): Assessment-Order passed in the name of non-existent amalgamating entity-valid. [Companies Act, 1956, S. 394, 481]

It was held that corporate death upon amalgamation does not invalidate assessment as after amalgamation, the amalgamating entity is treated as a continuing one, and any benefits, by way of carry forward of losses (of the transferor company), depreciation, etc., are allowed to the transferee. Therefore, unlike a winding up, there is no end to the enterprise, with the entity. The enterprise in the case of amalgamation, continues. Therefore, corporate death of an entity upon amalgamation per se invalidates an assessment order ordinarily cannot be determined on a bare application of Section 481 of the Companies Act, 1956 (and its equivalent in the 2013 Act), but would depend on the terms of the amalgamation and the facts of each case. matter is restored to the file of ITAT. (SLP (C) No. 4063 of 2020 dated April 05, 2022)

PCIT v. Mahagun Realtors Private Limited (SC) www.itatonline .org

[Coram : Hon’ble Justice Shri Uday Umesh Lalit and Hon’ble Justice Shri S. Ravindra Bhat]