Holding

An assessment order framed in the name of a non‑existent amalgamated company is void ab initio; the jurisdictional defect cannot be cured under s.292B.

Summary

The assessee, Suzuki Powertrain India Ltd (SPIL), was amalgamated into Maruti Suzuki India Ltd (MSIL) effective 1 April 2012. For Assessment Year 2012-13, a notice under s.143(2) of the Income Tax Act was issued to SPIL, which no longer existed, and a final assessment order adding Rs. 78.97 crore was passed in SPIL's name. The Income Tax Appellate Tribunal held the order void ab initio because the jurisdictional notice was issued to a non‑existent entity, a view affirmed by the Delhi High Court. The Revenue appealed, arguing the defect was procedural and curable under s.292B. The Supreme Court held that the notice and assessment constituted a substantive jurisdictional defect, not a procedural error, and could not be cured under s.292B, relying on the doctrine of merger and the precedent set in Spice Enfotainment. Consequently, the assessment was declared void and the appeal dismissed.

Issues considered

The validity of a notice under s.143(2) issued to a company that has ceased to exist due to an approved scheme of amalgamation.
Whether such a defect is substantive (jurisdictional) or merely procedural and therefore curable under s.292B of the Income Tax Act.
Whether participation of the successor company in the assessment proceedings creates an estoppel against the defect.
Whether the limitation provisions of s.153(1) and s.153(4) apply to the assessment in question.
The effect of the doctrine of merger and Article 141 on the consistency of tax jurisprudence.

Legislation cited

Companies Act, 1956s. 394
Income Tax Act, 1961s. 142(1), s. 143(2), s. 144C(15)(b), s. 148, s. 153(1), s. 153(4), s. 170(2), s. 2(31), s. 260A, s. 292B, s. 92CA(3)

Subjects

amalgamationassessmentjurisdictional defectSection 143(2)Section 292Bdoctrine of mergertax litigation certaintynon‑existent entitysubstantive illegalitytransfer pricing

Judgment

[2019] 9 S.C.R. 799 799

PR. COMMISSIONER OF INCOME TAX, NEW DELHI A
v.
MARUTI SUZUKI INDIA LIMITED
(Civil Appeal No. 5409 of 2019)
JULY 25, 2019 B
[DR DHANANJAYA Y CHANDRACHUD AND
INDIRA BANERJEE, JJ.]
Income Tax Act, 1961 – ss.143(2), 292B and ss.2(31),
92CA(3), 142(1), 144C (15)(b), 148, 153(1), 153(4), 170(2), 260A C
– Assessee, joint venture between Suzuki Motor Corporation and
Maruti Suzuki India Limited (MSIL) was known as Suzuki Metal
India Limited upon incorporation – Subsequently, w.e.f 8 June 2005,
its name was changed to Suzuki Powertrain India Limited (SPIL) –
On 28 Nov. 2012, the assessee filed its return of income in the name
D
of SPIL declaring income of Rs. 212,51,51,156/- – On 29 Jan. 2013,
scheme for amalgamation of SPIL and MSIL was approved by the
High Court w.e.f 1 April 2012 – Notices issued u/s.143(2)and 142(1)
to the amalgamating company – Draft assessment order was passed
in the name of SPIL seeking to increase the total income of the
assessee by Rs.78.97 Crores – On 31 Oct. 2016, final assessment E
order was passed in the name of SPIL – In appeal before ITAT, the
assessee objected that the assessment proceedings were continued
in the name of the non-existent entity SPIL and the final assessment
order issued in the name of non-existent entity was invalid – Final
assessment order set aside – Affirmed by the High Court – Held: In
F
the present case, notice u/s.143(2) under which jurisdiction was
assumed by the assessing officer was issued to a non-existent
company – Assessment order was issued against the amalgamating
company – This is substantive illegality and not procedural violation
of the nature adverted to in s.292B – Despite the fact that the
assessing officer was informed of the amalgamating company having G
ceased to exist as result of the approved scheme of amalgamation,
the jurisdictional notice was issued only in its name – Basis on
which jurisdiction was invoked was fundamentally at odds with the
legal principle that the amalgamating entity ceases to exist upon
H
799
800 SUPREME COURT REPORTS [2019] 9 S.C.R.

A the approved scheme of amalgamation – Participation by the
amalgamated company would have no effect since there could be
no estoppel against law, in view of the judgment of Co-ordinate
Bench in Spice Enfotainment case which dismissed the appeal of the
Revenue on 2 Nov. 2017 – Decision in Spice Enfotainment case has
been followed in the case of the respondent while dismissing the
B
Special Leave Petition for AY 2011-2012 – No reason to take a
different view and the same is adopted in respect of the present
appeal which relates to AY 2012-13 – Constitution of India – Art.141
– Companies Act, 1956 – s.394 – Estoppel – Doctrine of Merger.
Assessee is a joint venture between Suzuki Motor
C Corporation and Maruti Suzuki India Limited (MSIL). Upon
incorporation, the assessee was known as Suzuki Metal India
Limited. Subsequently, with effect from 8 June 2005, its name
was changed to Suzuki Powertrain India Limited (SPIL). On 28
November 2012, the assessee filed its return of income declaring
D income of Rs. 212,51,51,156/-. The return of income was filed in
the name of SPIL (no amalgamation having taken place on the
relevant date). On 29 January 2013, a scheme for amalgamation
of SPIL and MSIL was approved by the High Court with effect
from 1 April 2012. On 2 April 2013, MSIL intimated the assessing
officer of the amalgamation. The case was selected for scrutiny
E by the issuance of notice under Section 143(2) on 26 September
2013, followed by another notice under Section 142(1) to the
amalgamating company. On 11 March 2016, draft assessment
order was passed in the name of SPIL (amalgamated with MSIL).
The Order sought to increase the total income of the assessee
F by Rs. 78.97 crores in accordance with the order of the Transfer
Pricing Offer in order to ensure that the international transactions
with regard to the payment of royalty to the Associated
Enterprises is at Arm’s Length. On 12 April 2016, MSIL filed
appeal before the Dispute Resolution Panel (DRP) as successor
in interest of the erstwhile SPIL, since amalgamated. DRP issued
G order in the name of MSIL. Final assessment order was passed
on 31 October 2016 in the name of SPIL making addition of Rs.
78.97 crores to the total income of the assessee. The assessee
filed appeal before the Income Tax Appellate Tribunal. The
Tribunal vide order dated 6 April 2017, set aside the final
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PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 801
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assessment order on the ground that it was void ab initio, having A
been passed in the name of a non-existent entity by the assessing
officer. The order was affirmed in appeal under Section 260A by
the High Court. Hence, the present appeal.
Dismissing the appeal, the Court
HELD : 1.1 Certain significant facets of the present case B
are: (i) The income which is sought to be subjected to the charge
of tax for AY 2012-13 is the income of the erstwhile entity (SPIL)
prior to amalgamation. This is on account of a transfer pricing
addition of Rs. 78.97 crores; (ii) Under the approved scheme of
amalgamation, the transferee has assumed the liabilities of the C
transferor company, including tax liabilities; (iii) The consequence
of the scheme of amalgamation approved under Section 394 of
the Companies Act 1956 is that the amalgamating company ceased
to exist; (iv) Upon the amalgamating company ceasing to exist, it
cannot be regarded as a person under Section 2(31) of the Act
1961 against whom assessment proceedings can be initiated or D
an order of assessment passed; (v) Prior to 26 September 2013
when the jurisdictional notice under Section 143 (2) was issued,
the scheme of amalgamation had been approved on 29 January
2013 by the High Court of Delhi under the Companies Act 1956
with effect from 1 April 2012; (vi) The assessing officer assumed E
jurisdiction to make an assessment in pursuance of the notice
under Section 143 (2). The notice was issued in the name of the
amalgamating company in spite of the fact that on 2 April 2013,
the amalgamated company MSIL had addressed a communication
to the assessing officer intimating the fact of amalgamation. In
the above conspectus of the facts, the initiation of assessment F
proceedings against an entity which had ceased to exist was void
ab initio. [Para 19] [816-A-D; 817-A-E]
1.2 In Spice Entertainment, Division Bench of the Delhi
High Court dealt with the question as to whether an assessment
in the name of a company which has been amalgamated and has G
been dissolved is null and void or, whether the framing of an
assessment in the name of such company is merely a procedural
defect which can be cured. The High Court held that upon a notice
under Section 143 (2) being addressed, the amalgamated company
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802 SUPREME COURT REPORTS [2019] 9 S.C.R.

A had brought the fact of the amalgamation to the notice of the
assessing officer. Despite this, the assessing officer did not
substitute the name of the amalgamated company and proceeded
to make an assessment in the name of a non-existent company
which renders it void. This, in the view of the High Court, was
not merely a procedural defect. Moreover, the participation by
B
the amalgamated company would have no effect since there could
be no estoppel against law. Following the decision in Spice
Entertainment, the Delhi High Court quashed assessment orders
which were framed in the name of the amalgamating company in:
(i) Dimension Apparels; (ii) Micron Steels; and (iii) Micra India.
C [Para 20] [817-F-H; 818-E-F]
1.3 A batch of Civil Appeals was filed before Supreme Court
against the decisions of the Delhi High Court, the lead appeal
being Spice Enfotainment. On 2 November 2017, a Bench of this
Court consisting of Hon’ble Mr Justice Rohinton Fali Nariman
D and Hon’ble Mr Justice Sanjay Kishan Kaul dismissed the Civil
Appeals and tagged the Special Leave Petitions. The doctrine of
merger results in the settled legal position that the judgment of
the Delhi High Court stands affirmed by the said decision in the
Civil Appeals. The order of assessment in the case of the
respondent for AY 2011-12 was set aside on the same ground.
E This resulted in Special Leave Petition by the Principal
Commissioner of Income Tax – 6 Delhi. The Special Leave
Petition was dismissed by two judge Bench of this Court
consisting of Hon’ble Mr Justice Rohinton Fali Nariman and
Hon’ble Ms Justice Indu Malhotra on 16 July 2018 in view of
F the order dated 2 November 2017 governing Civil Appeal No.
285 of 2014 in Spice Enfotainment and the connected batch of
cases. Though, leave was not granted by this Court, reasons have
been assigned by this Court for rejecting the Special Leave
Petition. The law declared would attract the applicability of Article
141 of the Constitution. [Paras 24-26] [819-F-G; 820-A-D]
G
1.4 It was in the peculiar facts of the case that Supreme
Court indicated its agreement that the wrong name given in the
notice was merely a clerical error, capable of being corrected
under Section 292B. The “peculiar facts” of Skylight Hospitality

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PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 803
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emerge from the decision of the Delhi High Court. [Para 27] A
[821-D-E]
1.5 There is no conflict between the decisions of this Court
in Spice Enfotainment (dated 2 November 2017) and in Skylight
Hospitality LLP (dated 6 April 2018). In this case, the notice
under Section 143(2) under which jurisdiction was assumed by B
the assessing officer was issued to a non-existent company. The
assessment order was issued against the amalgamating company.
This is a substantive illegality and not a procedural violation of
the nature adverted to in Section 292B. [Paras 30, 31] [823-D;
824-A, D]
C
1.6 In the present case, despite the fact that the assessing
officer was informed of the amalgamating company having ceased
to exist as a result of the approved scheme of amalgamation, the
jurisdictional notice was issued only in its name. The basis on
which jurisdiction was invoked was fundamentally at odds with
the legal principle that the amalgamating entity ceases to exist D
upon the approved scheme of amalgamation. Participation in the
proceedings by the appellant in the circumstances cannot operate
as an estoppel against law. This position now holds the field in
view of the judgment of a co-ordinate Bench of two learned judges
which dismissed the appeal of the Revenue in Spice Enfotainment
E
on 2 November 2017. The decision in Spice Enfotainment has
been followed in the case of the respondent while dismissing the
Special Leave Petition for AY 2011-2012. In doing so, this Court
has relied on the decision in Spice Enfotainment. [Para 33]
[827-B-D]
1.7 No reason is found to take a different view. There is a F
value which the court must abide by in promoting the interest of
certainty in tax litigation. The view which has been taken by this
Court in relation to the respondent for AY 2011-12 must be
adopted in respect of the present appeal which relates to AY 2012-
13. Not doing so will only result in uncertainty and displacement G
of settled expectations. There is a significant value which must
attach to observing the requirement of consistency and certainty.
Individual affairs are conducted and business decisions are made
in the expectation of consistency, uniformity and certainty. To
detract from those principles is neither expedient nor desirable.
[Para 34] [827-E-F] H
804 SUPREME COURT REPORTS [2019] 9 S.C.R.

A Principal Commissioner of Income Tax – 6, New Delhi
v. Maruti Suzuki India Limited (2017) 397 ITR 681
DEL ; Spice Entertainment Ltd. v. Commissioner of
Service Tax 2012 (280) ELT 43 (Del.) ; Skylight
Hospitality LLP v. Assistant Commissioner of Income
Tax, Circle-28(1), New Delhi (2018) 405 ITR 296
B
(Delhi) ; Skylight Hospitality LLP case (Judgment of
Supreme Court dtd. 06.04.2018 in SLP (C) No.7409 of
2018) ; CIT, New Delhi v. Spice Enfotainment Ltd.
(Judgment of Supreme Court dtd. 02.11.2017 in Civil
Appeal No. 285 of 2014) ; CIT v. Intel Technology India
C (P) Ltd. [2016] 380 ITR 272 (Kar.) ; PCIT v. Nokia
Solutions & Network India (P) Ltd. [2018] 402 ITR 21
(Del) ; BDR Builders and Developers Pvt. Ltd. v ACIT
[2017] 397 ITR 529 (Del) ; Rustagi Engineering Udyog
(P.) Ltd. v DCIT [2016] 382 ITR 443 (Del) ; Khurana
Engineering Ltd. v DCIT [2014] 364 ITR 600 (Guj) ;
D
Takshashila Realties (P) Ltd. v DCIT [2017] 77 160
(Guj.) ; Alamelu Veerappan v. ITO [2018] 257 Taxman
72 (Madras) ; CIT v. Dimension Apparels Pvt. Ltd.
[2015] 370 ITR 288 (Del) ; CIT v Micron Steels P. Ltd.
[2015] 372 ITR 386 (Del.) (MAG.) ; CIT v Micra India
E (P) Ltd. [2015] 231 Taxman 809 (Del.) ; CIT v BMA
Capfin Ltd. [2018] 100 329 (Del.) ; Rajender Kumar
Sehgal v ITO (2019) 260 Taxman 412 (Del) ;
Chandreshbhai Jayantibhai Patel v. ITO (2019) 261
Taxman 137 (Guj) ; Commissioner of Income Tax,
Shillong v. Jai Prakash Singh (1996) 3 SCC 525 : [1996]
F
3 SCR 377 ; Chatturam v. CIT (1947) 15 ITR 302
(FC) ; Maharaja of Patiala v. CIT (1943) 11 ITR 202
(Bombay) – referred to.
Judgment of Supreme Court dtd. 16.07.2018 in
SLP (C) Diary No. 14106 of 2018 ; Kunhayammed v.
G State of Kerala (2000) 6 SCC 359 : [2000] 1 Suppl.
SCR 538 ; Saraswati Industrial Syndicate Ltd. v. CIT
(1990) 186 ITR 278 (SC) – relied on.
Halsbury’s Laws of England (4th edition volume 7) –
referred to.
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PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 805
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Case Law Reference A
(2017) 397 ITR 681 DEL referred to Para 1
2012 (280) ELT 43 (Del.) referred to Para 17
(2018) 405 ITR 296 (Delhi) referred to Para 17
[2000] 1 Suppl. SCR 538 relied on Para 17 B
(1990) 186 ITR 278 (SC) relied on Para 18
(2016) 380 ITR 272 (Kar.) referred to Para 18
(2018) 402 ITR 21 (Del) referred to Para 18
C
(2017) 397 ITR 529 (Del) referred to Para 18
(2016) 382 ITR 443 (Del) referred to Para 18
[2014] 364 ITR 600 (Guj) referred to Para 18
[2017] 77 160 (Guj.) referred to Para 18
D
[2018] 257 Taxman 72 (Madras) referred to Para 18
(2015) 370 ITR 288 (Del) referred to Para 18
(2015) 372 ITR 386 (Del.) referred to Para 18
(2015) 231 Taxman 809 (Del.) referred to Para 18
E
[2018] 100 329 (Del.) referred to Para 18
(2019) 260 Taxman 412 (Del) referred to Para 18
(2019) 261 Taxman 137 (Guj) referred to Para 18
[1996] 3 SCR 377 referred to Para 32 F
(1947) 15 ITR 302 (FC) referred to Para 32
(1943) 11 ITR 202 (Bombay) referred to Para 32
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5409
of 2019.
G
From the Judgment and Order dated 09.01.2018 of the High Court
of Delhi at New Delhi in Income tax Appeal No. 18 of 2018.
K. M. Nataraj, ASG, Arijit Prasad, Sr. Adv., Zoheb Hossain,
Shraddha Deshmukh, Rajat Nair, Arvind Kumar Sharma, Ms. Adeeba
Mujahid, Piyush Goyal, Mrs. Anil Katiyar, Advs. for the Appellant. H
806 SUPREME COURT REPORTS [2019] 9 S.C.R.

A Ajay Vohra, Sr. Adv., Ms. Kavita Jha, Vaibhav Kulkarni, Advs.
for the Respondent.
The Judgment of the Court was delivered by
DR. DHANANJAYA Y CHANDRACHUD, J.
B 1. This appeal arises from a judgment of a Division Bench of the
Delhi High Court dated 9 January 2018 which upheld the decision of the
Income Tax Appellate Tribunal1. The Tribunal held that the assessment
made in the name of Suzuki Powertrain India Limited2 for Assessment
Year3 2012-13 is a nullity since the entity had been amalgamated with
Maruti Suzuki India Limited4 under an approved scheme of amalgamation
C and was not in existence. The High Court, while affirming this view of
the Tribunal followed its own decision for AY 2011-12 in Principal
Commissioner of Income Tax – 6, New Delhi v Maruti Suzuki
India Limited (successor of SPIL)5 (“Maruti Suzuki”) . Holding
that no question of law arose, the High Court dismissed the appeal under
D Section 260A of the Income Tax Act 19616.
2. The Revenue is in appeal.
3. Against the decision of the High Court for AY 2011-12, a Special
Leave Petition7 was dismissed by a two judge Bench of this Court on 16
July 2018 with the following observations:
E
“Heard learned counsel for the parties.
Delay condoned.
In view of the order dated 02.11.2017 passed by this Court in
C.I.T., New Delhi Vs. M/s. Spice Enfotainment Ltd. (Civil Appeal
F No. 285 of 2014 etc. etc.), this special leave petition also stands
dismissed. Pending applications, if any, shall stand disposed of.”
On behalf of the respondent, it has been urged that in view of the
dismissal of the Special Leave Petition in relation to AY 2011-12, the
same course of action must follow in the present case which deals with
G the assessment for AY 2012-13.
1
“the Tribunal”
2
“SPIL”
3
“AY”
4
“MSIL”
5
(2017) 397 ITR 681 (DEL.)
6
“The Act 1961”
H 7
SLP (C) Diary No. 14106 of 2018
PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 807
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4. We have heard submissions on behalf of the appellant by Mr A
Zoheb Hossain, learned Counsel and for the respondents by Mr Ajay
Vohra, learned Senior Counsel. In order to appreciate the nature of the
controversy, a narration of the facts would be instructive.
5. The assessee is a joint venture between Suzuki Motor
Corporation and MSIL. The shareholding of the two companies in the B
assessee was 70 per cent and 30 per cent. The assessee was known
upon incorporation as Suzuki Metal India Limited. Subsequently, with
effect from 8 June 2005, its name was changed to SPIL.
6. On 28 November 2012, the assessee filed its return of income
declaring an income of Rs. 212,51,51,156/-. The return of income was C
filed in the name of SPIL (no amalgamation having taken place on the
relevant date).
7. On 29 January 2013, a scheme for amalgamation of SPIL and
MSIL was approved by the High Court with effect from 1 April 2012.
The terms of the approved scheme provided that all liabilities and duties D
of the transferor company shall stand transferred to the transferee
company without any further act or deed. On the scheme coming into
effect, the transferor was to stand dissolved without winding up. The
scheme stipulated that the order of amalgamation will not be construed
as an order granting exemptions from the payment of stamp duty or
taxes or any other charges, if payable, in accordance with law. E

8. On 2 April 2013, MSIL intimated the assessing officer of the
amalgamation. The case was selected for scrutiny by the issuance of a
notice under Section 143(2) on 26 September 2013, followed by a notice
under Section 142(1) to the amalgamating company.
F
9. On 22 January 2016, the Transfer Pricing Officer8 passed an
order under Section 92CA (3) determining the Arm’s Length Price of
royalty at 3 per cent and making an adjustment of Rs. 78.97 crores in
respect of royalty paid by the assessee for the relevant previous year.
10. On 11 March 2016, a draft assessment order was passed in
G
the name of Suzuki Powertrain India Limited” (amalgamated with Maruti
Suzuki India Limited). The draft assessment order sought to increase
the total income of the assessee by Rs. 78.97 crores in accordance with
the order of the TPO in order to ensure that the international transactions
8
“TPO” H
808 SUPREME COURT REPORTS [2019] 9 S.C.R.

A with regard to the payment of royalty to the Associated Enterprises is at
Arm’s Length.
11. MSIL participated in the assessment proceedings of the
erstwhile amalgamating entity, SPIL, through its authorized
representatives and officers. This is evident from the copies of the order
B sheets of the assessment proceedings before the assessing officer for
AY 2012-13. Post amalgamation, on 30 September 2013, the Chartered
Accountants addressed a communication to the Commissioner of Income
Tax, Circle 9(1), pursuant to the notice under Section 143(2) for an
adjournment of the assessment proceedings for AY 2012-13 until the
assessment proceedings for AY 2010-11 and AY 2011-12 were
C completed. On 27 October 2014, the Deputy Commissioner of Income
Tax Circle 9 (1) addressed a communication to the Principal Officer,
SPIL seeking a response to a detailed questionnaire. Thereafter, on 4
September 2015, the Deputy Commissioner of Income Tax Circle 16(1)
called for disclosure of information in the course of the assessment for
D AY 2012-13. The communication was addressed to:
“The Principal Officer
M/s Suzuki Power Train India Limited
(Now known as M/s Maruti Suzuki India Limited).”
E 12. On 8 October 2015, a communication was addressed by the
DGM (Finance) for MSIL in response to the notice under Section 142
(1) adverting to the case of SPIL for AY 2012-13.
13. On 12 April 2016, MSIL filed its appeal before the Dispute
Resolution Panel9 as successor in interest of the erstwhile SPIL, since
F amalgamated. Form 35A was verified by Mr Kenichi Ayukawa,
Managing Director & CEO of MSIL. The grounds of appeal before the
DRP did not allude to the objection that the draft assessment order was
passed in the name of SPIL (amalgamated with MSIL) or that this defect
would render the assessment proceedings invalid.
G 14. On 14 October 2016, the DRP issued its order in the name of
MSIL (as successor in interest of erstwhile SPIL since amalgamated).
15. The final assessment order was passed on 31 October 2016
in the name of SPIL (amalgamated with MSIL) making an addition of
9
“DRP”
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Rs. 78.97 crores to the total income of the assessee. While preferring A
an appeal before the Tribunal, the assessee raised the objection that the
assessment proceedings were continued in the name of the non-existent
or merged entity SPIL and that the final assessment order which was
also issued in the name of a non-existent entity, would be invalid.
16. By its decision dated 6 April 2017, the Tribunal set aside the B
final assessment order on the ground that it was void ab initio, having
been passed in the name of a non-existent entity by the assessing officer.
The decision of the Tribunal was affirmed in an appeal under Section
260A by the Delhi High Court on 9 January 2018 following its earlier
decision in the case of the assessee for AY 2011-12. That has given rise
to the present appeal. C

17. Mr Zoheb Hossain, learned Counsel appearing on behalf of
the appellant submitted that:
(i) The High Court was not justified in quashing the final assessment
order under Section 143 (3) only on the ground that the D
assessment was framed in the name of the amalgamating
company, which was not in existence, ignoring the fact that the
names of both the amalgamated company and the amalgamating
company were mentioned in the assessment order;
(ii) Even on the hypothesis that the assessment order was framed E
incorrectly in the name of the amalgamating company, it would
amount to a “mistake, defect or omission” which is curable under
Section 292B when the assessment is, “in substance and effect,
in conformity with or according to the intent and purpose” of
the Act;
F
(iii) During the assessment proceedings and the subsequent
proceedings in appeal, the amalgamating company was duly
represented by the amalgamated company. No prejudice was
caused to any of the parties by the assessment order and hence
rendering the assessment order invalid on a ‘mere technicality’
would be incorrect in law. There was effective participation of G
the assessee in the assessment proceedings and there was no
doubt in the minds of those who participated about the entity in
relation to which the assessment proceedings took place;

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810 SUPREME COURT REPORTS [2019] 9 S.C.R.

A (iv) In Spice Entertainment Ltd. v Commissioner of Service
Tax10 (“Spice Entertainment”)11, the final assessment order
only referred to the name of the erstwhile entity which was
non-existent and there was no reference to the resulting
company. In distinction, in the present case, in both the draft
and the final assessment orders, the names of both the
B
amalgamating and amalgamated companies were mentioned;
(v) In paragraph 11 of the decision of the Delhi High Court in Spice
Entertainment, it was held that:
“11. After the sanction of the scheme on 11th April, 2004,
the Spice ceases to exist w.e.f. 1st July, 2003. Even if Spice
C had filed the returns, it became incumbent upon the Income
tax authorities to substitute the successor in place of the
said ‘dead person’. When notice under Section 143(2) was
sent, the appellant/amalgamated company appeared and
brought this fact to the knowledge of the AO. He, however,
D did not substitute the name of the appellant on record.
Instead, the Assessing Officer made the assessment in the
name of M/s Spice which was non existing entity on that
day. In such proceedings and assessment order passed in
the name of M/s Spice would clearly be void. Such a defect
cannot be treated as procedural defect. Mere participation
E by the appellant would be of no effect as there is no estoppel
against law.”
From the above extract, it would emerge that if an assessment
order had been passed on the resulting company, it would not be
void. Hence, in the present case, the issuance of a notice under
F Section 143 (2) to SPIL cannot be considered to be a jurisdictional
effect when the assessment order categorically mentions the
names of the amalgamated and amalgamating companies;
(vi) The decision of the Delhi High Court in Skylight Hospitality
LLP v Assistant Commissioner of Income Tax, Circle-
G 28(1), New Delhi12 (“Skylight Hospitality LLP”), which was
confirmed by this Court on 6 April 201813 dealt with a situation
10
2012 (280) ELT 43 (Del.)
11
This judgement has also been referred to as Spice Infotainment v. Commissioner of
Income tax in Current Tax Reporter [(2012) 247 CTR (Del) 500]
12
(2018) 405 ITR 296 (Delhi)
13
H (2018) 13 SCC 147
PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 811
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where a notice under Section 148 was issued in the name of a A
non-existent private limited company. The Court held that the
defect in recording the name of a non-existent company in a
notice under Section 148 was a procedural defect or mistake
curable under Section 292B, since no prejudice was caused to
the assessee. The Delhi High Court distinguished the decision
B
in Spice Entertainment on the ground that in that case even
the final assessment order was in the name of a non-existent
company;
(vii) In the present case, both the draft assessment order and the
final assessment order contained the names of the amalgamated
and amalgamating companies and hence it cannot be held that C
the final order is in the name of a non-existent company. The
order of the TPO is not the subject of a challenge by the assessee
before any forum. The directions of the TPO were implemented
by the assessing officer in the draft assessment order in
accordance with Section 144C(1) which was then challenged D
by the assessee before the DRP under Section 144C(2). Since
the names of both the amalgamated and amalgamating
companies were mentioned in the draft assessment order and
final assessment order, there is no jurisdictional defect;
(viii) In view the decision of this Court in Kunhayammed v State of E
Kerala14 (“Kunhayammed”), though the doctrine of merger
does not apply when a Special Leave Petition is dismissed before
the grant of leave to appeal, where an order rejecting a Special
Leave Petition is a speaking order and reasons have been
assigned for rejecting the petition, the law stated or declared in
such an order will attract Article 141; and F
(ix) Consequently, in the alternative, in view of the order passed by
this Court on 6 April 2018 in Skylight Hospitality LLP on the
one hand and the order dated 16 July 2018 in the case of the
present assessee for AY 2011-12 and the earlier order dated 2
November 2017 in CIT, New Delhi v Spice Enfotainment G
Ltd.15 (“Spice Enfotainment Ltd”), there appears to be a direct
conflict of views on the principle whether a notice issued to a
non-existent company would suffer from a jurisdictional error
14
(2000) 6 SCC 359
15
Civil Appeal No. 285 of 2014 H
812 SUPREME COURT REPORTS [2019] 9 S.C.R.

A or whether it is a mere defect or mistake which would be
governed by Section 292B.
18. On the other hand, Mr Ajay Vohra, learned Senior Counsel
appearing on behalf of the respondents submitted that:
(i) Upon a scheme of amalgamation being sanctioned, the
B amalgamated company is dissolved without winding up, in terms
of Section 394 of the Companies Act 1956. The amalgamating
company ceases to exist in the eyes of law [Saraswati
Industrial Syndicate Ltd. v CIT16 (“Saraswati Industrial
Syndicate Ltd.”)];
C (ii) The amalgamating company cannot thereafter be regarded as a
“person” in terms of Section 2(31) of the Act 1961 against whom
assessment proceedings can be initiated and an assessment order
passed;
(iii) The jurisdictional notice under Section 143(2) of the Act, pursuant
D to which the assessing officer assumed jurisdiction to make an
assessment was issued in the name of SPIL, a non-existent
entity, and was invalid. Hence the initiation of assessment
proceedings against a non-existent entity was void ab initio.
It has been held in the following decisions that, if a statutory
E notice is issued in the name of a non-existent entity, the
entire assessment would be a nullity in the eyes of law:
- CIT v Intel Technology India (P) Ltd17
- PCIT v Nokia Solutions & Network India (P) Ltd.
(“Nokia Solutions”)18
F
- Spice Entertainment
- Similarly, a notice to the amalgamating company,
subsequent to the amalgamation becoming effective and
despite the fact of the amalgamation having been brought
G to the notice of the assessing officer, is void ab initio as
held in the following decisions:
- BDR Builders and Developers Pvt. Ltd. v ACIT19
16
(1990) 186 ITR 278 (SC)
17
[2016] 380 ITR 272 (Kar.)
18
[2018] 402 ITR 21 (Del)
H 19
[2017] 397 ITR 529 (Del)
PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 813
INDIA LTD. [DR. DHANANJAYA Y CHANDRACHUD, J.]

- Rustagi Engineering Udyog (P.) Ltd. v DCIT20 A
21
- Khurana Engineering Ltd. v DCIT
- Takshashila Realties (P) Ltd. v DCIT22
- Alamelu Veerappan v ITO23 (“Alamelu Veerappan”)
(iv) The order passed by the TPO in the name of SPIL, a non-existent B
entity was invalid in the eyes of the law:
SPIL ceased to be an “eligible assessee”, in terms of section
144C (15) (b) of the Act. Consequently, there was no
requirement to pass a draft assessment order/reference to
DRP etc.; and C
Furthermore, the final assessment order dated 31 October
2016 is beyond limitation in terms of Section 153(1) read
with Section 153 (4) of the Act.
(v) The assessment framed in the name of the amalgamating
D
Company is invalid:
In terms of Section 170(2) of the Act, once the amalgamation
is effective, assessment in respect of the income of the
amalgamating company upto the appointed date has to be
in the name of the amalgamated company as successor in
interest of the amalgamating company. E

The Delhi High Court has held in Spice Entertainment
that an assessment framed in the name of the amalgamating
company, which ceased to exist in the eyes of law, was
invalid and untenable in law. Such a defect would not be
cured in terms of Section 292B of the Act. Further, the fact F
that the amalgamated company participated in the
assessment proceedings would not operate as estoppel.
Following the aforesaid decision of the High Court in the
case of Spice Entertainment, the Delhi High Court
quashed assessment orders which were framed in the name G

20
[2016] 382 ITR 443 (Del)
21
[2014] 364 ITR 600 (Guj)
22
[2017] 77 taxmann.com 160 (Guj.)
23
[2018] 257 Taxman 72 (Madras) H
814 SUPREME COURT REPORTS [2019] 9 S.C.R.

A of an amalgamating company, recording also the name of
the amalgamated company, in the following cases:
-CIT v Dimension Apparels Pvt. Ltd24 (“Dimension
Apparels”); affirmed by this Hon’ble Court vide Civil
Appeal No. 3125 of 2015;
B - CIT v Micron Steels P. Ltd. (“Micron Steels”)25; and
-CIT v Micra India (P) Ltd. (“Micra India”)26.
The aforesaid judgments of the Delhi High Court have been
approved by this Court in Civil Appeal No.285 of 2014 (&
C other connected matters). Thus applying the doctrine of
merger, the law laid down by the Delhi High Court has
become a precedent under Article 141.
(vi) The Respondent’s case is squarely covered by the decision of
this Court in its own case for the immediately preceding year:
D The Delhi High Court by its judgment reported in Maruti
Suzuki held in favour of the Respondent by following the
judgment in the case of Spice Entertainment.
Further, the Revenue’s SLP was dismissed by this Court
on 16 July 2018 in SLP(C) D.No.14106/2018, following the
E judgment in Spice Entertainment.
Relying on the decision of this Hon’ble Court, in the following
decisions, assessments framed in the case of a non-existent
entity (the amalgamating company) have been held to be
non-est in the eyes of law:
F - CIT v BMA Capfin Ltd.27 (Revenue’s SLP dismissed
against the same vide order dated 19 November 201828
passed in SLP(C) Diary No.40486 of 2018).
- Nokia Solutions

G
24
[2015] 370 ITR 288 (Del)
25
[2015] 372 ITR 386 (Del.) (MAG.)
26
[2015] 231 Taxman 809 (Del.)
27
[2018] 100 taxmann.com 329 (Del.)
28
[2018] 100 taxmann.com 330 (SC)
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(vii) The judgment of the Delhi High Court in Skylight Hospitality A
LLP is distinguishable and is not applicable to the facts of the
present case:
The judgment was rendered on its own peculiar facts.
In that case, the tax evasion petition mentioned the factum of
conversion of the company into a Limited Liability Partnership29, B
which was also noticed in the reasons to believe and approval
of the Principal Commissioner (before issuance of a notice under
Section 148 of the Act). However, only because of a clerical
mistake, the notice was wrongly issued in the name of Skylight
Hospitality Pvt. Ltd. instead of Skylight Hospitality LLP. C
In the aforesaid facts, the High Court held that this was an
irregularity and procedural/ technical lapse which was curable
under section 292B of the Act.
The decision in the case of Spice Enfotainment was not
followed on the ground that it pertained to the passing of an D
assessment order in the name of a non-existent entity whereas
the case at hand dealt with a notice under Section 148 of the
Act.
The SLP filed by the assessee against the decision of the Delhi
High Court was dismissed recording: “In the peculiar facts of E
this case, we are convinced that wrong name given in the notice
was merely a clerical error which could be corrected under
Section 292B of Act 1961”;
Subsequently, various High Courts, including the Delhi High Court
have in the following decisions distinguished the judgment in the F
case of Skylight Hospitality LLP and have quashed the notice/
assessment framed in the name of a non-existent entity:
- Rajender Kumar Sehgal v ITO (“Rajender Kumar
Sehgal”)30
- Chandreshbhai Jayantibhai Patel v ITO G
(“Chandreshbhai Jayantibhai Patel”)31; and
- Alamelu Veerappan
29
“LLP”
30
[2019] 260 Taxman 412 (Del.)
31
(2019) 261 Taxman 137 (Guj) H
816 SUPREME COURT REPORTS [2019] 9 S.C.R.

A 19. While assessing the merits of the rival submissions, it is
necessary at the outset to advert to certain significant facets of the
present case:
(i) Firstly, the income which is sought to be subjected to the charge
of tax for AY 2012-13 is the income of the erstwhile entity (SPIL)
B prior to amalgamation. This is on account of a transfer pricing
addition of Rs. 78.97 crores;
(ii) Secondly, under the approved scheme of amalgamation, the
transferee has assumed the liabilities of the transferor company,
including tax liabilities;
C (iii) Thirdly, the consequence of the scheme of amalgamation
approved under Section 394 of the Companies Act 1956 is that
the amalgamating company ceased to exist. In Saraswati
Industrial Syndicate Ltd., the principle has been formulated
by this Court in the following observations:
D “5. Generally, where only one company is involved in change
and the rights of the shareholders and creditors are varied,
it amounts to reconstruction or reorganisation of scheme of
arrangement. In amalgamation two or more companies are
fused into one by merger or by taking over by another.
E Reconstruction or ‘amalgamation’ has no precise legal
meaning. The amalgamation is a blending of two or more
existing undertakings into one undertaking, the shareholders
of each blending company become substantially the
shareholders in the company which is to carry on the blended
undertakings. There may be amalgamation either by the
F transfer of two or more undertakings to a new company, or
by the transfer of one or more undertakings to an existing
company. Strictly ‘amalgamation’ does not cover the mere
acquisition by a company of the share capital of other
company which remains in existence and continues its
G undertaking but the context in which the term is used may
show that it is intended to include such an acquisition.
See: Halsbury’s Laws of England (4th edition volume 7
para 1539). Two companies may join to form a new
company, but there may be absorption or blending of one
by the other, both amount to amalgamation. When two
H
PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 817
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companies are merged and are so joined, as to form a third A
company or one is absorbed into one or blended with another,
the amalgamating company loses its entity.”
(iv) Fourthly, upon the amalgamating company ceasing to exist, it
cannot be regarded as a person under Section 2(31) of the Act
1961 against whom assessment proceedings can be initiated or B
an order of assessment passed;
(v) Fifthly, a notice under Section 143 (2) was issued on 26
September 2013 to the amalgamating company, SPIL, which
was followed by a notice to it under Section 142(1);
(vi) Sixthly, prior to the date on which the jurisdictional notice under C
Section 143 (2) was issued, the scheme of amalgamation had
been approved on 29 January 2013 by the High Court of Delhi
under the Companies Act 1956 with effect from 1 April 2012;
(vii) Seventhly, the assessing officer assumed jurisdiction to make
an assessment in pursuance of the notice under Section 143 (2). D
The notice was issued in the name of the amalgamating company
in spite of the fact that on 2 April 2013, the amalgamated company
MSIL had addressed a communication to the assessing officer
intimating the fact of amalgamation. In the above conspectus of
the facts, the initiation of assessment proceedings against an E
entity which had ceased to exist was void ab initio.
20. In Spice Entertainment, a Division Bench of the Delhi High
Court dealt with the question as to whether an assessment in the name
of a company which has been amalgamated and has been dissolved is
null and void or, whether the framing of an assessment in the name of F
such company is merely a procedural defect which can be cured. The
High Court held that upon a notice under Section 143 (2) being addressed,
the amalgamated company had brought the fact of the amalgamation to
the notice of the assessing officer. Despite this, the assessing officer did
not substitute the name of the amalgamated company and proceeded to
make an assessment in the name of a non-existent company which G
renders it void. This, in the view of the High Court, was not merely a
procedural defect. Moreover, the participation by the amalgamated
company would have no effect since there could be no estoppel against
law :
H
818 SUPREME COURT REPORTS [2019] 9 S.C.R.

A “11. After the sanction of the scheme on 11th April, 2004,
the Spice ceases to exit w.e.f. 1st July, 2003. Even if Spice
had filed the returns, it became incumbent upon the Income
tax authorities to substitute the successor in place of the
said „dead person . When notice under Section 143 (2) was
sent, the appellant/amalgamated company appeared and
B
brought this fact to the knowledge of the AO. He, however,
did not substitute the name of the appellant on record.
Instead, the Assessing Officer made the assessment in the
name of M/s Spice which was non existing entity on that
day. In such proceedings an assessment order passed in
C the name of M/s Spice would clearly be void. Such a defect
cannot be treated as procedural defect. Mere participation
by the appellant would be of no effect as there is no estoppel
against law.
12. Once it is found that assessment is framed in the name
D of non-existing entity, it does not remain a procedural
irregularity of the nature which could be cured by invoking
the provisions of Section 292B of the Act.”
Following the decision in Spice Entertainment, the Delhi High
Court quashed assessment orders which were framed in the
E name of the amalgamating company in:
(i) Dimension Apparels;
(ii) Micron Steels; and
(iii) Micra India.
F 21. In Dimension Apparels, a Division Bench of the Delhi High
Court affirmed the quashing of an assessment order dated 31 December
2010. The Respondent had amalgamated with another company and
thus, ceased to exist from 7 December 2009. The Court rejected the
argument of the Revenue that the assessment was in substance and
effect in conformity with the Act by reason of the fact that the assessing
G
officer had used correct nomenclature in addressing the Assessee; stated
the fact that the company had amalgamated and mentioned the correct
address of the amalgamated company. It was the Revenue’s contention
that the omission on the part of the assessing officer to mention the
name of the amalgamated company is a procedural defect. The Delhi
H
PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 819
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High Court rejected this contention. In doing so, it relied on the holding in A
Spice Entertainment, where the High Court expressly clarified that
“the framing of assessment against a non-existing entity/person” is a
jurisdictional defect. The Division Bench also relied on the holding in
Spice Entertainment that participation by the amalgamated company
in proceedings does not cure the defect as “there can be no estoppel in
B
law”, to affirm the quashing of the assessment order.
22. In Micron Steels, a notice was issued to Micron Steels Pvt
Ltd (original assessee) after it had amalgamated with Lakhanpal
Infrastructure Pvt Ltd. A Division Bench of the Delhi High Court upheld
the setting aside of assessment orders, noting that Spice Entertainment
is an authority for the proposition that completion of assessment in respect C
of a non-existent company due to the amalgamation order, would render
the assessment a nullity.
23. In Micra India, the original assessee Micra India Pvt. Ltd
had amalgamated with Dynamic Buildmart (P) Ltd. Notice was issued
to the original assessee by the Revenue after the fact of amalgamation D
had been communicated to it. The Court noted that though the assessee
had participated in the assessment, the original assessee was no longer
in existence and the assessment officer did not the take the remedial
measure of transposing the transferee as the company which had to be
assessed. Instead, the original assessee was described as one in existence E
and the order mentioned the transferee’s name below that of the original
assessee. The Division Bench adverted to the judgment in Dimension
Apparels wherein the High Court had discussed the ruling in Spice
Entertainment. It was held that this was a case where the assessment
was contrary to law, having been completed against a non-existent
company. F

24. A batch of Civil Appeals was filed before this Court against
the decisions of the Delhi High Court, the lead appeal being Spice
Enfotainment. On 2 November 2017, a Bench of this Court consisting
of Hon’ble Mr Justice Rohinton Fali Nariman and Hon’ble Mr Justice
Sanjay Kishan Kaul dismissed the Civil Appeals and tagged Special Leave G
Petitions in terms of the following order :
“Delay condoned.
Heard the learned Senior Counsel appearing for the parties.
H
820 SUPREME COURT REPORTS [2019] 9 S.C.R.

A We do not find any reason to interfere with the impugned
judgment(s) passed by the High Court.
In view of this, we find no merit in the appeals and special leave
petitions.
Accordingly, the appeals and special leave petitions are dismissed.”
B
25. The doctrine of merger results in the settled legal position that
the judgment of the Delhi High Court stands affirmed by the above
decision in the Civil Appeals.
26. The order of assessment in the case of the respondent for AY
C 2011-12 was set aside on the same ground. This resulted in a Special
Leave Petition by the Principal Commissioner of Income Tax – 6 Delhi32.
The Special Leave Petition was dismissed by a two judge Bench of this
Court consisting of Hon’ble Mr Justice Rohinton Fali Nariman and
Hon’ble Ms Justice Indu Malhotra on 16 July 2018 in view of the order
dated 2 November 2017 governing Civil Appeal No. 285 of 2014 in Spice
D Enfotainment and the connected batch of cases. Though, leave was
not granted by this Court, reasons have been assigned by this Court for
rejecting the Special Leave Petition. The law declared would attract the
applicability of Article 141 of the Constitution. For, as this Court has held
in Kunhayammed:
E “40…Where the order rejecting an SLP is a speaking order, that
is, where reasons have been assigned by this Court for rejecting
the petition for special leave and are stated in the order still the
order remains the one rejecting prayer for the grant of leave to
appeal. The petitioner has been turned away at the threshold
F without having been allowed to enter in the appellate jurisdiction
of this Court. Here also the doctrine of merger would not apply.
But the law stated or declared by this Court in its order shall
attract applicability of Article 141 of the Constitution. The reasons
assigned by this Court in its order expressing its adjudication
(expressly or by necessary implication) on point of fact or law
G shall take away the jurisdiction of any other court, tribunal or
authority to express any opinion in conflict with or in departure
from the view taken by this Court because permitting to do so
would be subversive of judicial discipline and an affront to the

32
Special Leave Petition (C) (D) No. 14106 of 2018
H
PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 821
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order of this Court. However this would be so not by reference to A
the doctrine of merger.”
27. The submission however which has been urged on behalf of
the Revenue is that a contrary position emerges from the decision of the
Delhi High Court in Skylight Hospitality LLP which was affirmed on
6 April 2018 by a two judge Bench of this Court consisting of Hon’ble B
Mr Justice A K Sikri and Hon’ble Mr Justice Ashok Bhushan 33. In
assessing the merits of the above submission, it is necessary to extract
the order dated 6 April 2018 of this Court:
“In the peculiar facts of this case, we are convinced that wrong
name given in the notice was merely a clerical error which could C
be corrected under Section 292B of the Income Tax Act.
The special leave petition is dismissed.
Pending applications stand disposed of.”
Now, it is evident from the above extract that it was in the peculiar D
facts of the case that this Court indicated its agreement that the wrong
name given in the notice was merely a clerical error, capable of being
corrected under Section 292B. The “peculiar facts” of Skylight Hospitality
emerge from the decision of the Delhi High Court34. Skylight Hospitality,
an LLP, had taken over on 13 May 2016 and acquired the rights and
liabilities of Skylight Hospitality Pvt. Ltd upon conversion under the Limited E
Liability Partnership Act 200835. It instituted writ proceedings for
challenging a notice under Sections 147/148 of the Act 1961 dated 30
March 2017 for AY 2010-2011. The “reasons to believe” made a
reference to a tax evasion report received from the investigation unit of
the income tax department. The facts were ascertained by the F
investigation unit. The reasons to believe referred to the assessment
order for AY 2013-2014 and the findings recorded in it. Though the
notice under Sections 147/148 was issued in the name of Skylight
Hospitality Pvt. Ltd. (which had ceased to exist upon conversion into an
LLP), there was, as the Delhi High Court held “substantial and affirmative
material and evidence on record” to show that the issuance of the notice G
in the name of the dissolved company was a mistake. The tax evasion
33
Special Leave Petition (C) No. 7409 of 2018
34
“Sky Light Hospitality LLP v Assistant Commissioner of Income Tax : (2018) 405
ITR 296 (Delhi)
35
“LLP Act 2008” H
822 SUPREME COURT REPORTS [2019] 9 S.C.R.

A report adverted to the conversion of the private limited company into an
LLP. Moreover, the reasons to believe recorded by the assessing officer
adverted to the approval of the Principal Commissioner. The PAN number
of the LLP was also mentioned in some of the documents. The notice
under Sections 147/148 was not in conformity with the reasons to believe
and the approval of the Principal Commissioner. It was in this background
B
that the Delhi High Court held that the case fell within the purview of
Section 292B for the following reasons:
“18…There was no doubt and debate that the notice was meant
for the petitioner and no one else. Legal error and mistake was
made in addressing the notice. Noticeably, the appellant having
C received the said notice, had filed without prejudice reply/letter
dated 11.04.2017. They had objected to the notice being issued in
the name of the Company, which had ceased to exist. However,
the reading of the said letter indicates that they had understood
and were aware, that the notice was for them. It was replied and
D dealt with by them. The fact that notice was addressed to M/s.
Skylight Hospitality Pvt. Ltd., a company which had been dissolved,
was an error and technical lapse on the part of the respondent.
No prejudice was caused.”
28. The decision in Spice Entertainment was distinguished with
E the following observations:
“19. Petitioner relies on Spice Infotainment Ltd. v. Commissioner
of Service Tax, (2012) 247 CTR 500. Spice Corp. Ltd., the
company that had filed the return, had amalgamated with another
company. After notice under Section 147/148 of the Act was issued
F and received in the name of Spice Corp. Ltd., the Assessing Officer
was informed about amalgamation but the Assessment Order was
passed in the name of the amalgamated company and not in the
name of amalgamating company. In the said situation, the
amalgamating company had filed an appeal and issue of validity
of Assessment Order was raised and examined. It was held that
G the assessment order was invalid. This was not a case wherein
notice under Section 147/148 of the Act was declared to be void
and invalid but a case in which assessment order was passed in
the name of and against a juristic person which had ceased to
exist and stood dissolved as per provisions of the Companies Act.
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PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 823
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Order was in the name of non-existing person and hence void and A
illegal.”
29. From a reading of the order of this Court dated 6 April 2018 in
the Special Leave Petition filed by Skylight Hospitality LLP against
the judgment of the Delhi High Court rejecting its challenge, it is evident
that the peculiar facts of the case weighed with this Court in coming to B
this conclusion that there was only a clerical mistake within the meaning
of Section 292B. The decision in Skylight Hospitality LLP has been
distinguished by the Delhi, Gujarat and Madras High Courts in:
(i) Rajender Kumar Sehgal;
(ii) Chandreshbhai Jayantibhai Patel; and C

(iii) Alamelu Veerappan.
30. There is no conflict between the decisions of this Court in
Spice Enfotainment (dated 2 November 2017) 36 and in Skylight
Hospitality LLP (dated 6 April 201837). D
31. Mr Zoheb Hossain, learned Counsel appearing on behalf of
the Revenue urged during the course of his submissions that the notice
that was in issue in Skylight Hospitality Pvt. Ltd. was under Sections
147 and 148. Hence, he urged that despite the fact that the notice is of a
jurisdictional nature for reopening an assessment, this Court did not find
E
any infirmity in the decision of the Delhi High Court holding that the
issuance of a notice to an erstwhile private limited company which had
since been dissolved was only a mistake curable under Section 292B. A
close reading of the order of this Court dated 6 April 2018, however
indicates that what weighed in the dismissal of the Special Leave Petition
were the peculiar facts of the case. Those facts have been noted above. F
What had weighed with the Delhi High Court was that though the notice
to reopen had been issued in the name of the erstwhile entity, all the
material on record including the tax evasion report suggested that there
was no manner of doubt that the notice was always intended to be issued
to the successor entity. Hence, while dismissing the Special Leave Petition
G
this Court observed that it was the peculiar facts of the case which led
the court to accept the finding that the wrong name given in the notice
was merely a technical error which could be corrected under Section
292B. Thus, there is no conflict between the decisions in Spice
36
Civil Appeal No. 285 of 2014 and connected cases
37
Special Leave Petition No. 7409 of 2018 H
824 SUPREME COURT REPORTS [2019] 9 S.C.R.

A Enfotainment on the one hand and Skylight Hospitality LLP on the
other hand.
It is of relevance to refer to Section 292B of the Income Tax Act
which reads as follows:
“292B. No return of income, assessment, notice, summons or other
B proceeding, furnished or made or issued or taken or purported to
have been furnished or made or issued or taken in pursuance of
any of the provisions of this Act shall be invalid or shall be deemed
to be invalid merely by reason of any mistake, defect or omission
in such return of income, assessment, notice, summons or other
C proceeding if such return of income, assessment, notice, summons
or other proceeding is in substance and effect in conformity with
or according to the intent and purpose of this Act.”
In this case, the notice under Section 143(2) under which
jurisdiction was assumed by the assessing officer was issued to a non-
D existent company. The assessment order was issued against the
amalgamating company. This is a substantive illegality and not a
procedural violation of the nature adverted to in Section 292B.
In this context, it is necessary to advert to the provisions of Section
170 which deal with succession to business otherwise than on death.
E Section 170 provides as follows:
“170. (1) Where a person carrying on any business or profession
(such person hereinafter in this section being referred to as the
predecessor) has been succeeded therein by any other person
(hereinafter in this section referred to as the successor) who
F continues to carry on that business or profession,—
(a) the predecessor shall be assesseed in respect of the income
of the previous year in which the succession took place up to the
date of succession;
(b) the successor shall be assesseed in respect of the income of
G the previous year after the date of succession.
(2) Notwithstanding anything contained in sub-section (1), when
the predecessor cannot be found, the assessment of the income
of the previous year in which the succession took place up to the
date of succession and of the previous year preceding that year
H shall be made on the successor in like manner and to the same
PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 825
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extent as it would have been made on the predecessor, and all the A
provisions of this Act shall, so far as may be, apply accordingly.
(3) When any sum payable under this section in respect of the
income of such business or profession for the previous year in
which the succession took place up to the date of succession or
for the previous year preceding that year, assesseed on the B
predecessor, cannot be recovered from him, the 99[Assessing]
Officer shall record a finding to that effect and the sum payable
by the predecessor shall thereafter be payable by and recoverable
from the successor and the successor shall be entitled to recover
from the predecessor any sum so paid.
C
(4) Where any business or profession carried on by a Hindu
undivided family is succeeded to, and simultaneously with the
succession or after the succession there has been a partition of
the joint family property between the members or groups of
members, the tax due in respect of the income of the business or
profession succeeded to, up to the date of succession, shall be D
assesseed and recovered in the manner provided in section 171,
but without prejudice to the provisions of this section.
Explanation.—For the purposes of this section, “income” includes
any gain accruing from the transfer, in any manner whatsoever,
of the business or profession as a result of the succession” E
Now, in the present case, learned Counsel appearing on behalf of
the respondent submitted that SPIL ceased to be an eligible assessee in
terms of the provisions of Section 144C read with clause (b) of sub
section 15. Moreover, it has been urged that in consequence, the final
assessment order dated 31 October 2016 was beyond limitation in terms F
of Section 153(1) read with Section 153 (4). For the purposes of the
present proceeding, we do not consider it necessary to delve into that
aspect of the matter having regard to the reasons which have weighed
us in the earlier part of this judgment.
32. On behalf of the Revenue, reliance has been placed on the G
decision of this Court in Commissioner of Income Tax, Shillong v
Jai Prakash Singh38 (“Jai Prakash Singh”). That was a case where
the assessee did not file a return for three assessment years and died in
the meantime. His son who was one of the legal representatives filed
38
(1996) 3 SCC 525 H
826 SUPREME COURT REPORTS [2019] 9 S.C.R.

A returns upon which the assessing officer issued notices under Section
142 (1) and Section 143 (2). These were complied with and no objections
were raised to the assessment proceedings. The assessment order
mentioned the names of all the legal representatives and the assessment
was made in the status of an individual. In appeal, it was contended that
the assessment proceedings were void as all the legal representatives
B
were not given notice. In this backdrop, a two judge Bench of this Court
held that the assessment proceedings were not null and void, and at the
worst, that they were defective. In this context, reliance was placed on
the decision of the Federal Court in Chatturam v CIT39 holding that the
jurisdiction to assess and the liability to pay tax are not conditional on the
C validity of the notice : the liability to pay tax is founded in the charging
sections and not in the machinery provisions to determine the amount of
tax. Reliance was also placed on the decision in Maharaja of Patiala v
CIT40 (“Maharaja of Patiala”). That was a case where two notices
were issued after the death of the assessee in his name, requiring him to
make a return of income. The notices were served upon the successor
D
Maharaja and the assessment order was passed describing the assessee
as “His Highness…late Maharaja of Patiala”. The successor appealed
against the assessment contending that since the notices were sent in
the name of the Maharaja of Patiala and not to him as the legal
representative of the Maharaja of Patiala, the assessments were illegal.
E The Bombay High Court held that the successor Maharaja was a legal
representative of the deceased and while it would have been better to so
describe him in the notice, the notice was not bad merely because it
omitted to state that it was served in that capacity. Following these two
decisions, this Court in Jai Prakash Singh held that an omission to
serve or any defect in the service of notices provided by procedural
F
provisions does not efface or erase the liability to pay tax where the
liability is created by a distinct substantive provision. The omission or
defect may render the order irregular but not void or illegal. Jai Prakash
Singh and the two decisions that it placed reliance upon were evidently
based upon the specific facts. Jai Prakash Singh involved a situation
G where the return of income had been filed by one of the legal
representatives to whom notices were issued under Section 142(1) and
143(2). No objection was raised by the legal representative who had
filed the return that a notice should also to be served to other legal
39
(1947) 15 ITR 302 (FC)
40
H (1943) 11 ITR 202 (Bombay)
PR. COMMISSIONER OF INCOME TAX, NEW DELHI v. MARUTI SUZUKI 827
INDIA LTD. [DR. DHANANJAYA Y CHANDRACHUD, J.]

representatives of the deceased assessee. No objection was raised before A
the assessing officer. Similarly, the decision in Maharaja of Patiala was
a case where the notice had been served on the legal representative, the
successor Maharaja and the Bombay High Court held that it was not
void merely because it omitted to state that it was served in that capacity.
33. In the present case, despite the fact that the assessing officer B
was informed of the amalgamating company having ceased to exist as a
result of the approved scheme of amalgamation, the jurisdictional notice
was issued only in its name. The basis on which jurisdiction was invoked
was fundamentally at odds with the legal principle that the amalgamating
entity ceases to exist upon the approved scheme of amalgamation.
Participation in the proceedings by the appellant in the circumstances C
cannot operate as an estoppel against law. This position now holds the
field in view of the judgment of a co-ordinate Bench of two learned
judges which dismissed the appeal of the Revenue in Spice
Enfotainment on 2 November 2017. The decision in Spice
Enfotainment has been followed in the case of the respondent while D
dismissing the Special Leave Petition for AY 2011-2012. In doing so, this
Court has relied on the decision in Spice Enfotainment.
34. We find no reason to take a different view. There is a value
which the court must abide by in promoting the interest of certainty in
tax litigation. The view which has been taken by this Court in relation to E
the respondent for AY 2011-12 must, in our view be adopted in respect
of the present appeal which relates to AY 2012-13. Not doing so will
only result in uncertainty and displacement of settled expectations. There
is a significant value which must attach to observing the requirement of
consistency and certainty. Individual affairs are conducted and business
decisions are made in the expectation of consistency, uniformity and F
certainty. To detract from those principles is neither expedient nor
desirable.
35. For the above reasons, we find no merit in the appeal. The
appeal is accordingly dismissed. There shall be no order as to costs.
G

Divya Pandey Appeal dismissed.

H