Notice u/s 148 invalid if other company charged for providing accommodation entry for merged with assessee company and thereby lost its legal existence

SLP dismissed against High Court ruling that where Assessing Officer issued notice under section 148 to assessee on ground that it had received certain accommodation entries from a bogus company, in view of fact that by time of issuance of notice, assessee had already merged with another company and thereby lost its legal existence, notice issued in name of assessee became invalid and, therefore, impugned reassessment proceedings deserved to be quashed*

[2018] 100 taxmann.com 416 (SC)

SUPREME COURT OF INDIA

Assistant Commissioner of Income-tax (Central) Circular 1(2)
v.

Dharmnath Shares & Services (P.) Ltd.

S. A. BOBDE AND NAVIN SINHA, JJ.SPECIAL LEAVE PETITION (CIVIL) DIARY

NO. 41239 OF 2018†

DECEMBER  10, 2018 

Section 148 of the Income-tax Act, 1961 – Income escaping assessment – Issue of notice for (Validity of) – Assessment year 2010-11 – Assessing Officer issued notice under section 148 against assessee on ground that it had received certain accommodation entries from a bogus company – High Court by impugned order held that since by time of issuance of said reassessment notice, assessee had already merged with another company and thereby lost its legal existence, notice issued in name of assessee became invalid and, therefore, impugned reassessment proceedings deserved to be quashed – Whether Special Leave Petition against impugned order was to be dismissed – Held, yes [Para 4] [In favour of assessee]