DCIT CEN CIR 4(4) CEN RG 4, MUMBAI V. NAHAR ENTERPRISES, MUMBAI

ITA 207/MUM/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 8026 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 11 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-01-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 14-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: VIMAL PUNMIYA PRAKASH BOHRA; KETAN JAIN LD ARS
• Keywords: Bogus purchase; Residential status; Search and seizure; Question of law; Wrong claim; Valuation report; Procedural lapse; Competent authority; Scheme of amalgamation; Block assessment
• Section: 132; 143(3); 92B; 142(1); 133A; 153A; 80IB

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI , , BEFORE HONBLE SHRI MAHAVIR SINGH, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM ./ I.T.A. NO.5851/MUM/2015 ( / ASSESSMENT YEAR: 2008-09) M/S. NAHAR ENTERPRISES [NOW KNOWN AS NAHAR BUILDERS LTD] B-1, MAHALAXMI CHAMBERS, BHULABHAI DESAI ROAD, MAHALAXMI, MUMBAI-400 026 / VS. DY. COMMISSI O NER OF INCOME TAX-(OSD-I) CENTRAL RANGE-7, MUMBAI. ./ ./PAN/GIR NO. AAAFN-1599-D ( ! /APPELLANT ) : ( '#! / RESPONDENT ) & ./ I.T.A. NO.207/MUM/2016 ( / ASSESSMENT YEAR: 2008-09) DY. COMMISSIONER O F INCOME TAX- CENTRAL CIRCLE 4(4) CENTRAL RANGE-4 MUMBAI. / VS. M/S. NAHAR ENTERPRISES [NOW KNOWN AS NAHAR BUILDERS LTD] B-1, MAHALAXMI CHAMBERS, BHULABHAI DESAI ROAD, MAHALAXMI, MUMBAI-400 026 ./ ./PAN/GIR NO. AAAFN-1599-D ( ! /APPELLANT ) : ( '#! / RESPONDENT ) & ./ I.T.A. NO.516/MUM/2016 ( / ASSESSMENT YEAR: 2009-10) M/S. NAHAR ENTERPRISES [NOW KNOWN AS NAHAR BUILDERS LTD] B-1, MAHALAXMI CHAMBERS, BHULABHAI DESAI ROAD, MAHALAXMI, MUMBAI-400 026 / VS. DY. COMMISSIONER OF INCOME TAX-(OSD-I) CENTRAL RANGE-7, MUMBAI. ./ ./PAN/GIR NO. AAAFN-1599-D ( ! /APPELLANT ) : ( '#! / RESPONDENT ) & ./ I.T.A. NO.1272/MUM/2016 ( / ASSESSMENT YEAR: 2009-10) DY. COMMISSIONER OF INCOME TAX- CENTRAL CIRCLE 4(4) CENTRAL RANGE-4 MUMBAI. / VS. M/S. NAHAR ENTERPRISES [NOW KNOWN AS NAHAR BUILDERS LTD] B-1, MAHALAXMI CHAMBERS, BHULABHAI DESAI ROAD, MAHALAXMI, MUMBAI-400 026 2 ./ ./PAN/GIR NO. AAAFN-1599-D ( ! /APPELLANT ) : ( '#! / RESPONDENT ) ASSESSEE BY : VIMAL PUNMIYA, PRAKASH BOHRA & KETAN JAIN- LD. ARS RE VENUE BY : PURUSHOTTAM TRIPURI - LD. DR / DATE OF HEARING : 04/12//2018 / DATE OF PRONOUNCEMENT : 02/01/2019 / O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. THESE CROSS APPEALS FOR ASSESSMENT YEARS [AY] 20 08-09 & 2009- 10 AGITATE SEPARATE ORDERS OF FIRST APPELLATE AUTHO RITY. SINCE IDENTICAL ISSUES ARE INVOLVED AND SIMILAR GROUNDS OF APPEAL H AVE BEEN RAISED, WE PROCEED TO DISPOSE-OFF THE SAME BY WAY OF THIS COMM ON ORDER FOR THE SAKE OF CONVENIENCE & BREVITY. FIRST, WE TAKE UP CR OSS-APPEALS FOR AY 2008-09 WHEREIN THE GROUNDS URGED BY REVENUE READS AS UNDER: - I. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD.CIT(A) ERRED IN DIRECTING THE AO TO ALLOW DEDUCTION U/S.80 IB(10) OF THE IT ACT.' II. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN HOLDING THAT THE SCOPE OF SECTION 153A IS LIMITED TO ASSESSING ONLY SEARCH RELATING TO INCRIMINATING DOCUMENTS FOUND DU RING SEARCH AND NOT EXAMINING THE ISSUE FOLLOWING THE DECISION OF HON'B LE BOMBAY COURT IN THE CASE OF CONTINENTAL WAREHOUSING AND ALSO IN THE CAS E OF AL CARGO LOGISTICS WITHOUT APPRECIATING THAT DEPARTMENT HAS NOT ACCEPT ED THE SAID DECISION AND SLP HAS BEEN FILED IN THE HON'BLE SUPREME COURT,' III. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD.CIT(A) ERRED IN HOLDING THAT NO EVIDENCE OR INCRIMINATING MATERIAL FOUND DURING THE SEARCH WITHOUT APPRECIATING THAT EVIDENCE FOR WRONG CLAIM OF DEDUCTION U/S.80IB(10) WAS FOUND IN THE FORM OF STATEMENTS TA KEN, PHOTOGRAPH TAKEN WHICH SHOWS THAT AREA CLAIMED IS NOT CORRECT AND EV IDENCE NEED NOT BE ONLY WRITTEN DOCUMENTS.' IV. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD.CIT(A) ERRED IN EXCLUDING CUPBOARD PROJECTION FROM BUILT U P AREA WHEN AMENDMENT BROUGHT IN BY FINANCE ACT (NO.2), 2004 W.E.F. 01.04 .2005 CLEARLY DEFINES BUILT UP AREA TO MEAN AND TO INCLUDE PROJECTIONS AND BALC ONIES.' 3 V. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN EXCLUDING SERVICE AREA FROM BUILT UP AREA WHEN ITS EXCLUSIVE OWNERSHIP HAS NOT BEEN DISPROVED BY THE ASSESSEE.' VI. ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE LD.CIT(A) ERRED IN EXCLUDING WINDOW PROJECTIONS FROM BUILT UP AREA WHEN AMENDMENT BROUGHT IN BY FINANCE ACT (NO.2), 2004 W.E.F. 01.04 .2005 CLEARLY DEFINES BUILT UP AREA TO MEAN AND TO INCLUDE PROJECTIONS AND BALC ONIES.' THE EFFECTIVE GROUNDS URGED BY THE ASSESSEE READS A S UNDER: - THE APPELLANT FIRM PREFERS AN APPEAL AGAINST AN ORD ER DATED 16/10/2015 PASSED BY LD. COMMISSIONER OF INCOME TAX APPEALS-52, MUMBAI O N FOLLOWING AMONGST OTHER GROUNDS EACH OF WHICH ARE WITHOUT PREJUDICE TO ANY OTHER: - 1.0 THE LD. CIT (A) ERRED IN CONFIRMING THE ASSESSM ENT ORDER PASSED U/S 143(3) R.W.S. 153A BY THE LD. AO, WHICH IS BAD-IN-LAW WITH OUT APPRECIATING THAT: - A) ASSESSMENT ORDER U/S 143(3) R.W.S 153A CAN BE PA SSED ONLY ON ISSUANCE OF VALID SEARCH WARRANT; B) ASSESSMENT CANNOT BE FRAMED IN THE NAME OF A DIS SOLVED ENTITY; C) THE PAN OF THE APPELLANT FIRM IS NO MORE IN EXIS TENCE AND HENCE ASSESSMENT FRAMED AND DEMAND NOTICE ISSUED IN THE N AME OF OLD PAN IS INVALID; D) THERE IS COMPLETE CHANGE IN THE CONSTITUTION OF THE APPELLANT FROM FIRM TO COMPANY AND NOT MERELY A CHANGE IN THE 'NAME' OF TH E APPELLANT AND HENCE MERELY MENTION OF ('NOW KNOWN AS 'NAHAR BUILDERS LI MITED') IN THE SEARCH WARRANT IS IRRELEVANT; 1.1 ON FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, LD. CIT (A) ERRED IN NOT DIRECTING THE ASSESSING OFFICER FOR PROVING THE SAT ISFACTION NOTE ON INITIATION FOR SEARCH PROCEEDING INITIATED ON THE APPELLANT. 2.0 ON FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, LD. CIT (A) ERRED IN IGNORING THE FACT THAT THE APPOINTMENT OF THE DEPAR TMENTAL VALUATION OFFICER (DVO) ITSELF IS BAD IN LAW ON UNDERSTATED FACTS: (A) THE LD. DVO WAS NOT A MEMBER OF SEARCH PARTY NO R HIS SERVICES WERE REQUISITIONED BY THE AUTHORIZED OFFICER IN TERMS OF PROVISION U/S 132(2) OF THE ACT. THE SAME IS SUPPORTED BY THE FACT THAT THE PAN CHNAMA DOES NOT MENTION THE NAME OF THE LD. DVO; (B) THE MEASUREMENT SHEETS DO NOT CONTAIN THE SIGNA TURES OF THE INDEPENDENT PANCHAS WHICH PROVES THAT THE LD. DVO'S REPORT DID NOT FORM A PART OF THE PANCHNAMA; 3.0 ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, LD. A.O. ERRED IN DENYING DEDUCTION U/S 80IB (10) OF RS. 21,23,67,5897- ON TH E PLEA THAT BUILT UP AREA OF MAJORITY OF THE RESIDENTIAL UNITS EXCEED 1000 SQ .FT. BY SOLELY RELYING ON THE MEASUREMENTS TAKEN BY THE SEARCH TEAM I.E. LD. DVO; 3.1 ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, LD. CIT (A) ERRED IN INTERPRETATION OF THE PROVISIONS OF SECTION 80IB(14 )(A) AND THEREBY INCLUDED THE FLOWER BED (PROJECTION) AT NON-FLOOR LEVEL OF T HE RESIDENTIAL UNIT AS A PART OF BUILT UP AREA; 3.2 THE LD. CIT(A) FAILED TO APPRECIATE THAT ONCE FACTUALLY IT WAS PROVED THAT 'FLOWER BED' AREA IS BELOW THE FLOOR LEVEL, IT OUGH T NOT TO HAVE TREATED THE SAME AS 'BALCONY WHICH IS CONTRARY TO FACT AS WELL AS T HE DCR REGULATIONS AND PERMISSION / SANCTIONS. 4 3.3 THE LD. CIT (A) ERRED IN SUBSTITUTING THE MEAN ING/DEFINITION ASSIGNED TO 'FLOWER BED' AS 'BALCONY ACCORDING TO ITS OWN CONV ENIENCE SO AS TO DENY THE DEDUCTION U/S. 80IB (10) OF THE ACT. 3.4 ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, LD. CIT (A) ERRED IN ASSUMING THAT STRUCTURAL CHANGES MADE BY THE FLATS OWNER AFTER HANDING OVER POSSESSION WERE DONE BY THE APPELLANT. 3.5 ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, LD. CIT (A) ERRED IN EXCLUDING ONLY 50% AREA OF COMMON WALL FROM BUILT-U P AREA INSTEAD OF 100% AREA OF COMMON WALL. 4.0 THE LD. CIT (A) ERRED IN DISALLOWANCE OF DEDUCT ION U/S 80IB (10) ON IGNORING THE UNDERSTATED VITAL FACTS, BEING; A) THE RESIDENTIAL UNITS IN RESPECT OF ALL THE HOUS ING PROJECTS, INCLUDING THOSE MEASURED BY THE DEPARTMENT, AS ON THE DATE OF SEARC H WERE NOT IN THE OWNERSHIP OF THE APPELLANT AND ALREADY SOLD APPROXI MATELY 5 TO 6 YEARS BACK; B)THE MEASUREMENT TAKEN BY THE LD. DVO WERE NOT TAK EN ACCURATELY AND WERE ROUGH AND APPROXIMATE. THE WALL THICKNESS ADOP TED BY THE LD. DVO FOR CALCULATION PURPOSES WERE ON THE HIGHER SIDE AS COM PARED TO THOSE APPROVED AS PER THE PLAN SANCTIONED BY THE MCGM; C)THE LOCAL AUTHORITY IS THE APPROPRIATE GOVERNMENT AUTHORITY FOR DEVELOPMENT OF HOUSING PROJECT AND AREA APPROVED BY THE LOCAL A UTHORITY AND CERTIFICATE ISSUED BY MUNICIPAL ARCHITECT IS RELIABLE EVIDENCE; D)THE BUILT UP AREA OF EACH RESIDENTIAL UNIT IN EAC H PLAN APPROVED BY THE LOCAL AUTHORITY (BMC/ MCGM), ARCHITECT CERTIFICATE AND EN GINEERS REPORT, LETTER OF ALLOTMENT, REGISTERED AGREEMENT FOR SALE, COMMENCEM ENT CERTIFICATE, BUILDING COMPLETION PLAN AND OCCUPATION CERTIFICATE ARE LESS THAN 1000 SQ.FT.; E)THE BUILT UP AREA OF EACH RESIDENTIAL UNIT OUGHT TO BE CONSIDERED AS ON THE DAY WHEN THE OCCUPATION/COMPLETION CERTIFICATE WAS ISSUED BY THE LOCAL AUTHORITY AND ANY ALTERATIONS/MODIFICATIONS MADE/DO NE THEREAFTER BY THE PURCHASERS/FLATHOLDERS, THE APPELLANT SHALL NOT BE HELD RESPONSIBLE; F)THE PROJECTION SUCH AS FLOWER BED ETC. ARE NOT AT THE FLOOR LEVEL AND ARE ON THE OUTER SIDE OF THE RESIDENTIAL UNIT FOR THE PURP OSE OF KEEPING FLOWER POTS. THEY ARE MERELY ELEVATIONAL/ ORNAMENTAL FEATURES WH ICH ARE OPEN TO SKY, NOT ENCLOSED BY WALLS, ADD TO THE BEAUTIFICATION OF THE HOUSING PROJECT AND IN NO MANNER CONSTITUTE THE INNER PART OF THE RESIDENTIAL UNIT; G)THE LOCAL AUTHORITY (BMC)/ MCGM ALSO, EVEN AS ON DATE CHARGES PROPERTY TAX ON THE ENTIRE RESIDENTIAL UNIT EXCLUDING ELEVAT IONAL FEATURES SUCH AS FLOWER BED ETC. AND COMMON AREAS SHARED WITH OTHER RESIDEN TIAL UNITS; 5.0 THE LD. CIT (A) ERRED IN CONSIDERING AN INCENT IVE PROVISION IN A STRICT MANNER, WHICH SHOULD BE CONSTRUED LIBERALLY; 2.1 FACTS IN BRIEF ARE THAT THE ASSESSEE BEING RESIDENT FIRM STATED TO BE ENGAGED AS BUILDERS & DEVELOPERS WAS ASSESSED FOR IMPUGNED AY U/S 143(3) READ WITH SECTION 153A ON 14/03/2014 BY LD. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, OSD-1, MUMBAI [AO] WHEREIN THE ASSESSEE WAS DENIED THE BENEFIT OF DEDU CTION U/S 80IB (10) AGAINST CERTAIN BUILDING CONSTRUCTION PROJECTS. THE ASSESSEE GROUP WAS 5 SUBJECTED TO SEARCH / SURVEY ACTION ON 02/02/2012 W HEREIN IT TRANSPIRED THAT THE GROUP WRONGLY AVAILED DEDUCTION U/S 80IB ( 10), BOOKED BOGUS PURCHASES TO REDUCE THE PROFITS, RECEIVED / ADVANCED LOANS I N CASH AND CHARGED ON-MONEY ON SALE OF SHOPS IN CERTAIN PROJECTS. THE SEARCH ACTION WAS CONCLUDED ON 28/03/2012, BEING THE LAST DATE ON WHICH AUTHORIZATION WAS EXECUTED. THE GROUP WAS STATED TO BE ENGAGED IN THE BUSINESS OF DEVELOPMENT OF COMMERCIAL AND RESIDENTIAL PROJECTS, COMPRISING OF RESIDENTIAL APARTMENTS, VILLAS, ROW H OUSES, SUPER LUXURIOUS APARTMENTS, PROVIDING THEREIN ALL MODERN AMENITIES SUCH AS CLUBHOUSE, SWIMMING POOL AND SHOPPING COMPLEX . THE SEIZED PAPER AND OTHER INCRIMINATING DOCUMENTS FOUND DURING THE COURSE OF SEARCH WAS CONFRONTED TO THE ASSESSEE AND THE STATEMENTS OF CO NCERNED PERSONS WERE RECORDED. DURING THE COURSE OF SEARCH PROCEEDI NGS, THE ASSESSEE ADMITTED UNDISCLOSED INCOME FOR AYS 2007-08 TO 2012 -13, THE DETAILS OF WHICH HAVE ALREADY BEEN EXTRACTED IN THE QUANTUM AS SESSMENT ORDER. 2.2 THE ORIGINAL RETURN OF INCOME FILED BY THE ASSE SSEE AT RS.18.70 CRORES AFTER CLAIMING DEDUCTION U/S 80IB(10) FOR RS .21.22 CRORES WAS ASSESSED IN SCRUTINY ASSESSMENT U/S 143(3) ON 16/12/2010 AT RS.18.95 CRORES. IN RESPONSE TO NOTICE U/S 153A, THE ASSESSE E OFFERED INCOME OF RS.18.95 CRORES AFTER CLAIMING DEDUCTION U/S 80IB ( 10) FOR RS.21.23 CRORES CLAIMED AGAINST THE CAMELIA BUILDING PROJECT . THE CLAIM U/S 80IB(10) WAS ENHANCED BY RS.1.66 LACS TO ACCOUNT FO R SURRENDER OF BOGUS PURCHASES MADE BY THE ASSESSEE. 2.3 ONE OF THE MAIN ALLEGATIONS LEADING TO THE SEAR CH ACTION WAS THE FACT THAT THE ASSESSEE MADE WRONG CLAIM OF DEDUCTIO N U/S 80IB(10) SINCE IT VIOLATED THE CONDITIONS OF SECTION 80IB(10) BY C ONSTRUCTING RESIDENTIAL UNITS IN EXCESS OF THRESHOLD LIMIT OF 1000 SQUARE F EETS IN ITS AMRIT SHAKTI 6 BUILDING PROJECTS, POWAI, MUMBAI. DURING PRE-SEARCH INQUIRIES, IT WAS NOTED THAT THE ASSESSEE WAS CONVERTED INTO PRIVATE LIMITED COMPANY DURING FINANCIAL YEAR 2011-12 AND IT STARTED CLAIMI NG DEDUCTION U/S 80IB(10) AGAINST AMRIT SHAKTI PROJECT SINCE AY 2008-09 ONWARDS. THE QUANTUM OF THIS DEDUCTION FOR AY 2008-09 WAS RS.21. 22 CRORES ON ACCOUNT OF CAMELIA A, B & C BUILDING . 2.4 DURING SEARCH PROCEEDINGS, A DETAILED EXERCISE WAS UNDERTAKEN FOR CARRYING OUT THE MEASUREMENTS OF THE BUILT-UP AREA IN CONSULTATION WITH VALUATION OFFICER [DVO] APPOINTED BY THE SEARCHING AUTHORITIES. UPON PERUSAL OF DVOS REPORT, IT TRANSPIRED THAT MOST OF THE FLATS WERE OF AREA EXCEEDING 1000 SQUARE FEETS WHICH WAS IN VIOLATION OF PROVISIONS OF SECTION 80IB(10) AND THEREFORE, THE ASSESSEE WAS NO T ENTITLED FOR THE AFORESAID EXEMPTION. THE ASSESSEE WAS CONFRONTED WI TH THE SAME VIDE DETAILED NOTICE U/S 142(1) DATED 25/11/2013, AS REP RODUCED IN THE QUANTUM ASSESSMENT ORDER ON PAGE NUMBERS 21 TO 44 . 2.5 THE ASSESSEE DEFENDED ITS STAND ALONG WITH SUPP ORTING DOCUMENTS, BUILDING PLANS, COPIES OF AGREEMENTS AND CERTIFICAT ES AND SUBMITTED THAT IT WAS ELIGIBLE TO CLAIM THE AFORESAID DEDUCTION. T HE ASSESSEE, INTER-ALIA, DISPUTED THE MEASUREMENTS UNDERTAKEN BY DVO DURING SEARCH PROCEEDINGS AND CONTENDED THAT CERTAIN AREAS WERE T O BE EXCLUDED WHILE COMPUTING THE BUILT-UP AREA. IT WAS CONTENDED THAT NOTICE U/S 153A WAS BAD IN LAW AS NO VALID SEARCH WAS CONDUCTED AGAINST THE ASSESSEE IN VIEW OF THE FACT THAT SEARCH WARRANT DATED 01/02/20 12 WAS ISSUED IN THE NAME OF DISSOLVED ENTITY NAMELY NAHAR ENTERPRISES WHICH WAS NO MORE IN EXISTENCE AT THE TIME OF SEARCH AND NO SEARCH WA RRANT COULD BE ISSUED IN THE NAME OF A PERSON / ENTITY WHICH WAS NOT IN E XISTENCE. HOWEVER, REJECTING THE SAME, LD. AO DENIED DEDUCTION U/S 80I B(10) AMOUNTING TO 7 RS.21.23 CRORES TO THE ASSESSEE AND COMPLETED THE A SSESSMENT VIDE ORDER DATED 14/03/2014. 3.1 AGGRIEVED, THE ASSESSEE AGITATED THE ASSESSMENT PROCEEDINGS ON LEGAL GROUNDS AS WELL AS ON MERITS BEFORE LD. CIT(A ) VIDE IMPUGNED ORDER DATED 16/10/2015. THE ASSESSEE URGED THAT THE PROCEEDINGS U/S 153A WERE BAD IN LAW SINCE THERE WAS NO INCRIMINATI NG MATERIAL FOUND DURING SEARCH OPERATIONS FROM THE ASSESSMENT ORIGIN ALLY CONCLUDED U/S 143(3) OF THE ACT. HOWEVER, THE SAME WAS CONTROVERT ED BY LD. AO IN REMAND REPORT DATED 23/03/2015. THE OBJECTIONS RAISED BY THE ASSE SSEE WITH RESPECT TO MEASUREMENT OF BUILT-UP AREA AND PL EA TO EXCLUDE SERVICE AREA, WINDOW/CUPBOARD PROJECTIONS, SUNKEN AREA WAS ALSO CONFRONTED TO THE LD. DVO . THE LD. DVO SUBMITTED A DETAILED REPORT ON 20/06/2014. THE RELEVANT EXTRACTS OF ALL THESE COMMUNICATIONS / REPORTS / CORRESPONDENCES ETC. HAVE EXHAUSTIBLY BEEN REPRODUC ED IN THE IMPUGNED ORDER. 3.2 THE ASSESSEE ALSO RAISED A LEGAL PLEA THAT SEARCH WARRANT WAS EXECUTED ON 02/02/2012 WHEN THE ASSESSEE FIRM WAS N OT IN EXISTENCE AND HAD ALREADY DISSOLVED ON 20/11/2011 AND THEREFO RE, SEARCH PROCEEDINGS WERE NOT VALID IN TERMS OF DECISION OF HONBLE PUNJAB & HARYANA HIGH COURT RENDERED IN CIT VS RAKESH KUMAR AND CERTAIN OTHER DECISIONS OF THE TRIBUNAL. HOWEVER, LD. CIT(A), AFT ER DUE CONSIDERATION OF RELEVANT MATERIAL, CAME TO A CONCLUSION THAT SEA RCH WARRANTS DATED 01/02/2012 AND 09/03/2012 AS WELL AS PANCHNAMAS DRAWN SUBSEQUENT TO SEARCH CARRIED THE NAME OF OLD ENTITY AS WELL AS NEW ENTITY AND THEREFORE, THE PROCEEDINGS WERE VALID. 3.3 THE ASSESSEE ALSO DISPUTED THE CALCULATION OF B UILT-UP AREA VIDE SUBMISSIONS DATED 05/01/2015 AND IN SUPPORT FURNISH ED A LEGAL OPINION 8 FROM HONBLE SHRI S.H. KAPADIA, FORMER CHIEF JUSTICE, SU PREME COURT IN SUPPORT OF THE CONTENTION THAT FLOWER BED AREA, DRY BALCONY AREA AND ORNAMENTAL PROJECTIONS WHICH WERE NOT AT FLOOR LEVEL WERE NOT TO BE INCLUDED IN COMPUTING THE BUILT-UP AREA. SIMILAR OP INION EXPRESSED BY KANGA & CO., SOLICITORS AND SHRI RAJESH SHAH ENGINEERS & CONSULTANTS PRIVATE LIMITED WAS FURNISHED IN SUPPORT OF THE SAME. HOWEVER, NOT CONVINCED AND AFTER CONSIDERING THE MEANING OF BUIL T-UP AREA AS DEFINED U/S 80IB (14)(A), LD. CIT(A), AS CONCLUDED FOR AYS 2010-11 TO 2012-13, OPINED THAT AREAS OF SERVICE DUCTS ATTACHED TO THE BATHROOMS ETC. AND AREA OF WINDOW PROJECTIONS WAS NOT TO BE INCLUDED I N THE BUILT-UP AREA WHEREAS AREA OF FLOWER BEDS BEING IN THE NATURE OF BALCONY WAS LIABLE TO BE INCLUDED WHILE COMPUTING BUILT-UP AREA. 3.4 DURING APPELLATE PROCEEDINGS, THE ASSESSEE RAIS ED ANOTHER PLEA BY SUBMITTING THAT ORIGINAL ASSESSMENT WAS COMPLETED U /S 143(3) WHEREIN THE ASSESSEES CLAIM U/S 80IB(10) WAS DULY EXAMINED BY LD. AO AND IN THE ABSENCE OF ANY INCRIMINATING MATERIAL FOUND DUR ING THE COURSE OF SEARCH ACTION, THE ASSESSMENT COULD NOT BE DISTURBE D IN TERMS OF DECISION OF HONBLE BOMBAY HIGH COURT RENDERED IN MURLI AGRO PRODUCTS LTD VS CIT . RELIANCE WAS PLACED ON MANY OTHER JUDICIAL PRONOU NCEMENTS TO SUPPORT THE SAME. UPON DUE CONSIDERATION OF MATE RIAL ON RECORD, ASSESSEES SUBMISSIONS AND CONTENTIONS, REMAND REPORTS, LD. CIT(A), AT PARAGRAPH 62, CONCURRED WITH THE AFORESAID PLEA BY OBSERVING THAT THE ASSESSEES CLAIM U/S 80IB(10) WAS DULY EXAMINED DUR ING THE COURSE OF EARLIER SURVEY CONDUCTED BY THE DEPARTMENT ON 23/02 /2010 AND THE CLAIM WAS SUBSEQUENTLY BEEN ALLOWED AFTER DUE VERIFICATIO N IN SCRUTINY ASSESSMENT U/S 143(3). THE LD. CIT(A) FURTHER CONCL UDED THAT THE MATERIAL GATHERED DURING THE SEARCH PROCEEDINGS COU LD NOT BE TERMED AS 9 INCRIMINATING MATERIAL AND THEREFORE THE AFORESAID DEDUCTION AS ALLOWED TO THE ASSESSEE DURING ORIGINAL ASSESSMENT PROCEEDI NGS COULD NOT BE DISTURBED. 3.5 AGGRIEVED, THE ASSESSEE AS WELL AS REVENUE HAS SOUGHT OUR INDULGENCE IN THE MATTER BY WAY OF THESE CROSS APPE ALS. 4. THE LD. AUTHORIZED REPRESENTATIVE FOR ASSESSEE [ AR], SHRI VIMAL PUNMIYA, AT THE OUTSET, DREW OUR ATTENTION TO THE FACT THAT THE IMPUGNED SEARCH PROCEEDINGS TRIGGERED ASSESSMENT U/S 153A AG AINST THE ASSESSEE FOR AYS 2008-09 TO 2012-13 AND THE MATTER FOR AYS 2010-11 TO 2012-13 ALREADY TRAVELLED UP-TO THE LEVEL OF THIS T RIBUNAL VIDE COMMON ORDER ITA NOS. 2853 TO 2855/MUM/2015, 3572 TO 3574/ MUM/2015 DATED 07/04/2017 WHEREIN A VIEW HAS ALREADY BEEN TAKEN BY THE TRIBUNAL IN THE MATTER AND THEREFORE, THE SAME SHOULD BE FOLLOWED, FACTS AND CIRCUMSTANCES BEING IDENTICAL. THE LD. AR FURTHER S UBMITTED THAT THE ASSESSMENT ORDER HAS BEEN QUASHED BY THE TRIBUNAL F INDING FORCE IN LEGAL PLEA OF THE ASSESSEE AND FURTHER, THE ISSUE O N MERITS HAS ALSO BEEN DECIDED SUBSTANTIALLY IN ASSESSEES FAVOR. THE COPY OF THE CITED ORDER OF THE TRIBUNAL HAS BEEN PLACED ON RECORD. PER CONTRA, LD. DEPARTMENTAL REPRESENTATIVE [DR], SHRI PURUSHOTTAM TRIPURI STRESSED THAT THE ORDER OF LD. AO SHOULD BE UPHOLD SINCE THE APPEAL FILED BY T HE ASSESSEE IN THE NAME OF DISSOLVED ENTITY BEFORE FIRST APPELLATE AUT HORITY AS WELL AS BEFORE THE TRIBUNAL IS NON-EST AND COULD NOT BE TAKEN COGNIZANCE OF. HOWEVER, THE FACT THAT THE MATTER HAS ALREADY BEEN DELVED UP ON BY THE TRIBUNAL FOR AYS 2010-11 TO 2012-13 REMAINED UNCONTROVERTED. 5. WE HAVE CAREFULLY PERUSED THE RIVAL CONTENTIONS AND GONE THROUGH RELEVANT MATERIAL ON RECORD INCLUDING THE CITED ORD ER OF THIS TRIBUNAL RENDERED IN ASSESSEES OWN CASE FOR AYS 2010-11 TO 2012-13. IT IS 10 UNDISPUTED FACT THAT SEARCH PROCEEDINGS HAVE TRIGGE RED ASSESSMENT U/S 153A FOR AYS 2008-09 TO 2012-13 AND THE SEARCH PROC EEDINGS SPRING FROM COMMON SEARCH WARRANTS / PANCHNAMAS ETC. & IDENTICAL GROUNDS HAVE BEEN TAKEN IN CROSS APPEALS. NOTHING ON RECORD SUGGEST THAT THE AFORESAID DECISION HAS EVER BEEN OVERRULED OR STAYE D BY THE DECISION OF ANY HIGHER JUDICIAL AUTHORITY. UNDER THESE CIRCUMST ANCES, HAVING NO OTHER OPTION, RESPECTFULLY FOLLOWING THE SAME, WE CONCLUD E THE MATTER IN SIMILAR MANNER. FOR EASE OF REFERENCE, THE RELEVANT FINDING S / OBSERVATIONS ETC. ON LEGAL GROUNDS AS WELL ON MERITS, AS ADJUDICATED BY THE TRIBUNAL COULD BE EXTRACTED IN THE FOLLOWING MANNER: - 3.ISSUE RAISED BY THE ASSESSEE IN THE FIRST GROUND OF APPEAL IS A LEGAL ISSUE. THE ORDER OF THE CIT(A) WAS CHALLENGED ON THE GROUND THAT THE ORDER PASSED BY THE AO UNDER SECTION 143(3) R.W.S.153A WAS AN ORDER PASSED ON TH E NON-EXISTING ENTITY ON THE GROUND THAT THE FIRM ON WHICH THE ORDER WAS PASSED WAS M/S NAHAR ENTERPRISES WHICH STANDS CLOSED WITH EFFECT FROM 20.11.2011 AND THE BUSINESS WAS TAKEN OVER BY M/S NAHAR BUILDERS LIMITED AND THEREFORE THE ASSE SSMENT ORDER PASSED ON NON- EXISTING ENTITY IS BAD IN LAW AND VOID AB-INITIO. 4.BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE- NA HAR ENTERPRISES A PARTNERSHIP FIRM WAS FORMED IN THE YEAR 1978 AND WAS ENGAGED IN THE BUSINESS OF CONSTRUCTION OF BUILDINGS AND DEVELOPMENT OF THE PROPERTIES. ON 9.9 .2011 A NEW COMPANY WAS INCORPORATED UNDER THE COMPANIES ACT, 1956 IN THE N AME AND STYLE OF M/S NAHAR BUILDERS LIMITED. THE ASSESSEE FIRM NAHAR ENTERPI SES WAS DISSOLVED ON 20.11.2011 AND THE BUSINESS OF THE FIRM WAS TAKEN O VER BY THE SAID COMPANY NAHAR BUILDERS LTD. THE INCOME TAX DEPARTMENT WAS INFORME D QUA THE SAID CHANGE IN STATUS OF THE ASSESSEE VIDE LETTER DATED 1.12.2011. 5.THE DISSOLVED FIRM M/S NAHAR ENTERPRISES WAS ENGA GED IN THE BUSINESS OF DEVELOPING RESIDENTIAL COMPLEX WITH THE NAME AMRUT SHAKTI AT CHANDIVALI, ANDHERI (E), MUMBAI WHEREIN IT HAD COMPLETED AS MAN Y AS 19 DIFFERENT RESIDENTIAL BLOCKS. THE SAID FIRM CLAIMED DEDUCTION U/S 80IB(10 ) OF THE ACT IN RESPECT OF RESIDENTIAL BUILDINGS FROM THE ASSESSMENT YEARS 200 6-07 TO 2011-12 6.A SEARCH ACTION U/S 132(1) AND ALSO SURVEY ACTION U/S 133A WERE CARRIED OUT ON 2.2.2012 ON NAHAR GROUP OF CASES AND ITS ASSOCIATE CONCERNS. THE SEARCH WAS CONCLUDED ON 28.3.2012 BEING THE LAST DATE ON WHICH AUTHORIZATION WAS EXECUTED. THE ASSESSEE AND ITS ENTIRE GROUP OF CONCERNS WERE ENGAGED IN THE BUSINESS OF DEVELOPMENT OF COMMERCIAL AND RESIDENTIAL PROJECTS. A SEARCH WARRANT WAS ISSUED IN THE NAME OF ERSTWHILE FIRM M/S NAHAR ENTERPRISES A NON EXISTENT ENTITY AND SO WAS THE SEARCH WHEREAS AS A MATTER OF FACT THE BUSI NESS OF M/S NAHAR ENTERPRISES WAS TAKEN OVER BY M/S NAHAR BUILDERS LTD UPON DIS SOLUTION ON THE DATE OF SEARCH AND WAS NON-EXISTENT. THE ASSESSEE FIRM WAS DISSOLV ED ON 20.11.2011 AND NOT IN 11 EXISTENCE WHEN THE WARRANT WAS SERVED ON 2.2.2012. THUS, THE WARRANT WAS ISSUED IN THE NAME OF ASSESSEE FIRM WHICH WAS DISSOLVED WITH EFFECT FROM 20.11.2011 EVEN THOUGH THE DEPARTMENT WAS INFORMED TO THIS FACT OF DISSOLUTION OF ASSESSEE FIRM BY A LETTER DATED 1.12.2011. WHEREAS IN PUNCHANAMA NO. 9 303, DATED 27.3.2012 AND IN THE PUNCHANANA DATED 28.3.2012 THE NAME WAS MENTION ED AS NAHAR ENTERPRISES (NOW KNOWN AS M/S NAHAR BUILDERS LTD). THE ASSESSE E CONTENDED BEFORE THE AO THAT SINCE THE SEARCH WARRANT WAS ISSUED IN THE NAM E OF NAHAR ENTERPRISES AND THE ASSESSMENT WAS COMPLETED IN THE NAME OF NAHAR ENTER PRISES A FIRM WHICH WAS NOT IN EXISTENCE WHEN THE WARRANT WAS ISSUED THE ASSESSMEN T COULD NOT BE MADE ON THE DISSOLVED ASSESSEE FIRM. 7.THE AO DID NOT AGREE WITH THE LEGAL AND TECHNICAL ISSUE RAISED BY THE ASSESSEE THAT THE SEARCH WAS CONDUCTED ON NON-EXISTING ENTITY AND ALSO CONSEQUENT ASSESSMENT BEING BAD IN LAW. THE ASSESSING OFFICER CONCLUDED T HAT THE WARRANT ISSUED IN THE NAME OF NAHAR ENTERPRISES (NOW KNOWN AS NAHAR BUIL DERS LTD) IS LEGALLY VALID AND THE ASSESSMENTS WERE NOT BAD IN LAW. AGGRIEVED BY T HE ORDER OF THE AO, THE ASSESSEE PREFERRED APPEALS BEFORE THE LD.CIT(A) WHO ALSO DIS MISSED THE APPEALS OF THE ASSESSEE CONFIRMING THE STAND OF THE AO ON THIS ISS UE BY OBSERVING AND HOLDING AS UNDER (PARA 13 AND 14 OF CIT(A)S ORDER) : 13. I HAVE CONSIDERED THE FACTS OF THE CASE AND CO NTENTIONS OF THE ASSESSEE. FROM THE DISCUSSION IN FOREGOING PARAGRAPHS, IT APPEARS THAT THE SEARCH WARRANT WAS ISSUED IN THE NAME OF M/ S. NAHAR ENTERPRISES (NOW KNOWN AS NAHAR BUILDER S LTD.). IT FURTHER APPEARS THAT THE NAMES OF BOTH THE ENTITIES, NAMELY THE OLD ENTITY, WHICH WAS CLAIMED TO HAVE BEEN DISSOLVED ON 20/11/2011, AND THE NEW ENTITY M/S. NAHAR BUILDERS LTD., WHICH TOOK OVER THE BUSINESS OF M/S. NAHAR ENTERPRISES, AS GOING CONCERN, HAVE BEEN CLEA RLY MENTIONED IN THE PANCHNAMA PREPARED AFTER SEARCH. FURTHER, BOTH THE SEARCH WARRANTS DAT ED 1/2/2012 AND 9/3/2012 WERE SHOWN TO SHRI SUKHRAJ NAHAR, PARTNER IN M/S. NAHAR ENTERPRIS ES AND MANAGING DIRECTOR OF M/S. NAHAR BUILDERS LTD., WHO HAPPENS TO BE THE MAIN PERSON OF THE TWO ENTITIES WHO SIGNED BOTH THE SEARCH WARRANTS. IT IS FURTHER GATHERED THAT TWO PANCHANAM AS WERE PREPARED - ONE AT THE PROJECT SITE AT CHANDIVALI AND ANOTHER ONE AT THE OFFICE PREMISE S AT MAHALAXMI CHAMBERS, VALLABHBHAI DESAI ROAD - AND BOTH THE PANCHNAMAS HAVE BEEN WITNESSED AND SIGNED BY INDEPENDENT PANCHAS, NAMELY SHRI MOHAN J. CHOPDA & SHRI SATNAM SINGH AND SHRI SAGAR B PADALKAR AND SHRI HANUMANTAN IMALOPANKAR, RESPECTIVELY. MOREOVER, BOT H THE PANCHNAMAS HAVE BEEN SIGNED BY SHRI SUKHRAJ NAHAR, MAIN PERSON OF THE GROUP, ALSO. BESIDES, THE PANCHNAMA DRAWN AT MAHALAXMI CHAMBERS CLEARLY SHOWS THAT THE WARRANT HAD BEEN IS SUED IN THE NAME OF M/S. NAHAR ENTERPRISES (NOW KNOWN AS M/S. NAHAR BUILDERS LTD.) , THOUGH THE OTHER PANCHNAMA DRAWN AT CHANDIVALI CARRIES THE NAME OF M/S.NAHAR ENTERPRISE S ONLY AND THE NAME OF M/S. NAHAR BUILDERS LTD. HAS NOT BEEN' MENTIONED. BUT THAT MAY BE BECAU SE OF SOME OVERSIGHT. 14. FROM THE ASSESSMENT ORDER, THEREFORE, IT APPEAR S THAT WARRANT OF AUTHORIZATION FOR SEARCH WAS APPARENTLY ISSUED IN THE NAME OF M/S. NAHAR ENT ERPRISES (NOW KNOWN AS M/ S. NAHAR BUILDERS LTD.) AND THE CORRECT ADDRESS OF THE OFFIC E PREMISES AS ALSO THE PROJECT SITE WERE MENTIONED THEREIN. ON CONCLUSION OF THE SEARCH PROC EEDINGS, THE PANCHNAMA HAS BEEN DRAWN IN THE NAME OF M/S. NAHAR ENTERPRISES (NOW KNOWN AS M/S. NAHAR BUILDERS LTD.) AND THE ENTIRE PROCEEDINGS WERE CARRIED OUT IN THE PRESENCE OF TWO INDEPENDENT PANCHAS, WHO HAVE SIGNED AND VERIFIED THE PANCHNAMAS. FURTHER, THE PANCHNAMA S HAVE ALSO BEEN SIGNED AND VERIFIED BY SHRI SUKHRAJ NAHAR, THE MAIN PERSON OF THE GROUP. A CCORDINGLY, THE OBJECTIONS RAISED BY THE LEARNED AR ABOUT THE VALIDITY OF THE SEARCH PROCEED INGS ARE MISPLACED AND UNTENABLE AND THE SAME ARE THEREFORE REJECTED. ACCORDINGLY, THE PROCE EDINGS INITIATED U] S.153A OF THE ACT AND ASSESSMENT COMPLETED U/S 143(3) READ WITH SECTION 1 53A ARE HELD VALID. I FURTHER HOLD THAT THE RATIO OF THE JUDGMENT OF HON'BLE PUNJAB & HARYANA H IGH COURT IN THE CASE OF CIT VS. RAKESH KUMAR AND THE DECISION OF HON'BLE ITAT, INDORE BENC H, IN THE CASE OF LATE SMT. LAXMIBAI KARANPURIA VS. ACIT (SUPRA.) ARE DISTINGUISHABLE ON FACTS OF THE PRESENT CASE, IN AS MUCH AS, IN THE PANCHNAMA DRAWN SUBSEQUENT TO SEARCH, NAMES OF THE OLD ENTITY AS WELL AS THE NEW ENTITY HAD BEEN VERY CLEARLY MENTIONED, AND, THEREFORE, IT IS NOT THE CASE AS IF THE SEARCH WARRANT WAS 12 EXECUTED ON A DEAD PERSON AND PANCHNARNA WAS DRAWN IN THE NAME OF A DEAD PERSON. SINCE THE PANCHNAMA HAS BEEN DRAWN IN THE NAME OF M/S. NA HAR ENTERPRISES (NOW KNOWN AS M/S.NAHAR BUILDERS LTD.), IT MAKES THE ENTIRE PROCE EDINGS QUITE CLEAR AND THERE IS NO AMBIGUITY WHATSOEVER. ACCORDINGLY, THIS GROUND OF ANNEAL OF T HE ASSESSEE IS REJECTED. 8. THE LD. AR VEHEMENTLY ARGUED BEFORE US THAT AS P ER THE PROVISIONS OF SECTION 2(31) OF THE INCOME TAX ACT, THE COMPANY AND FIRM W ERE SEPARATE AND DISTINCT ENTITIES. HE FURTHER SUBMITTED THAT IT WAS CLEAR FR OM THE PUNCHANAMA THAT THE SEARCH WARRANT WAS AUTHORIZED/ISSUED AGAINST THE OLD NON-E XISTENT ENTITY NAHAR ENTERPRISES BUT NOT IN THE NAME OF NAHAR BUILDERS LTD. THE LD. AR ALSO POINTED OUT THAT NO SEPARATE SEARCH WARRANT /NOTICES WERE I SSUED IN THE NAME OF FORMAL PARTNERS OF THE ASSESSEE FIRM AS REQUIRED UNDER THE PROVISIONS OF SECTION 283(2) OF THE ACT INDICATING THEIR STATUS AS FORMAL PARTNERS OF T HE DISSOLVED FIRM. THE LD. AR SUBMITTED THAT AUTHORIZATION OF THE SEARCH PARTY WA S ILLEGAL AND SO WAS THE CONSEQUENT SEARCH PROCEEDINGS AND ASSESSMENT PROCEE DINGS. IN DEFENCE OF HIS ARGUMENTS, THE LD.AR HEAVILY RELIED ON THE DECISION OF PUNJAB AND HARIYANA HIGH COURT IN THE CASE OF CIT V/S RAKESH KUMAR, MUKESH KUMAR REPORTED IN 178 TAXMAN 224(P&H) AND THIS DECISION WAS CHALLENGED BE FORE THE HON BLE SUPREME COURT WHICH WAS DISMISSED. THE DECISION IN THE CASE OF LATE SMT LAXIMIBAI KARANPURIA V/S ACIT REPORTED IN 130 ITD 40 (INDORE) , THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT V/S INDU SURVEY ORS AND LOSS ASSESSORS PVT LTD IN ITA NO.365 OF 2013, DATED 15.10.2015. 9. THE LD. AR FURTHER SUBMITTED THAT NO VALID ASSES SMENT COULD BE FRAMED ON THE STRENGTH OF INVALID SEARCH WARRANT AND THE ASSESSME NT PROCEEDINGS FRAMED ON THE BASIS OF INVALID SEARCH WARRANTS WERE BAD IN LAW AN D VOID AB- INITIO. THE LD. AR FURTHER SUBMITTED THAT THE ENTITY ON WHICH THE SEAR CH WARRANT WAS SERVED WAS HOLDING PAN AAAFN1599D WHICH WAS DISALLOWED ON 20.1 1.2011 MEANING THEREBY THAT THE ASSESSMENT PROCEEDINGS WERE INITIA TED AGAINST THE NON-EXISTING PERSON AND ULTIMATELY THE ASSESSMENT ORDER WAS PASS ED ON THE VERY SAME ENTITY WHICH IS NOT IN EXISTENCE AND THEREFORE THE ASSESSM ENTS MADE ON SUCH ENTITY U/S 143(3) R.W.S.153A WERE BAD IN LAW AND PRAYED THAT T HE SAME SHOULD BE QUASHED AS BEING INVALID AND VOID-ABINITIO. 10. THE LD. DR , ON THE OTHER HAND, STRONGLY OPPOSE D THE ARGUMENTS OF THE LD. AR AND SUBMITTED THAT THERE IS ONLY ONE PUNCHANAMA BEA RING NO.9303 DATED 27.3.2012 WHICH WAS EXECUTED IN THE NAME OF SEVERAL PARTIES O UT OF WHICH ONE NAME APPEARING WAS NAHAR ENTERPRISES WHEREAS OTHER PUNCHANAMA BE ARING NO.9302 DATED 28.3.2012 WAS ISSUED IN THE NAME OF M/S NAHAR ENTER PRISES (NOW KNOWN AS M/S NAHAR BUILDERS LTD) AND THUS CORRECTLY ISSUED. THE LD. DR ARGUED THAT PUNCHANAMA WAS DRAWN IN THE NAME OF M/S NAHAR ENTERPRISES (NO W KNOWN AS M/S NAHAR BUILDERS LTD) AND THUS CANNOT BE SAID TO BE IT WAS ISSUED INVALIDLY. THE LD. DR ALSO ARGUED THAT SINCE BOTH THE ENTITIES WERE AT THE SAM E PREMISES, THE PUNCHANAMA WAS DRAWN IN THE NAME OF BOTH ENTITIES AND HENCE CANNOT BE HELD TO BE INVALID. THE LD. DR FURTHER ARGUED THAT THE ASSESSEE NEVER OBJECTED AT THE TIME OF SEARCH PROCEEDINGS TO THE SAME AND DULY ACKNOWLEDGED RECEIPT OF WARRAN T WHICH PROVED BEYOND DOUBT THAT SEARCH WARRANT WAS CORRECTLY ISSUED AND ARGUME NTS RAISED BY THE LD.AR THAT THE SEARCH WARRANT AND PUNCHANAMA WERE IN THE NAME OF DISSOLVED ENTITY WAS AN AFTER THOUGHT AND SHOULD NOT BE CONSIDERED. THE L D. DR ALSO EXPRESSED HIS INABILITY RATHER DECLINED TO FURNISH THE SEARCH WARRANT ISSUE D AGAINST THE ASSESSEE ON THE 13 GROUND THAT SEARCH WARRANT CANNOT BE PRODUCED BEFOR E THE TRIBUNAL. LASTLY, THE LD. DR SUBMITTED THAT THE MISTAKE IN THE PUNCHANAMA WAS PURELY CLERICAL IN NATURE AND DESERVES TO BE OVERLOOKED AND THE LEGAL AND TECHNIC AL OBJECTION TAKEN BY THE ASSESSEE SHOULD BE REJECTED. 11.WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND PERUSED THE MATERIAL PLACED BEFORE US INCLUDING THE ORDERS OF AUTHORITIE S BELOW AND DECISIONS RELIED UPON BY THE PARTIES. UNDISPUTED FACTS ARE THAT THE FIRM M/S NAHAR ENTERPRISES WAS DISSOLVED ON 20.11.2011 AND THE BUSINESS OF THE SAI D FIRM WAS TAKEN OVER BY A LIMITED COMPANY WHICH WAS INCORPORATED ON 9.9.2011 REGISTERED UNDER THE NAME AND STYLE OF M/S NAHAR BUILDERS LTD, WHICH TOOKOVER THE BUSINESS OF ERSTWHILE FIRM. THE FACT OF DISSOLUTION OF THE ERSTWHILE FIRM AND T AKING OVER THE BUSINESS BY THE NEWLY INCORPORATED FIRM M/S NAHARA BUILDERS LTD WAS INTIMATED TO THE DEPARTMENT VIDE LETTER DATED 30.11.2011 WHICH WAS ACKNOWLEDGED ON 1.12.2011 BY THE OFFICE OF THE DY.COMMISSIONER OF INCOME TAX. A SEARCH WAS CON DUCTED ON 2.2.2012 AND CONCLUDED ON 28.3.2012 IN THE PREMISES OF ASSESSEE NAHAR GROUP AND THE ASSESSMENTS WERE COMPLETED UNDER SECTION 143(3) R.W .S. 153A IN THE NAME OF NAHAR ENTERPRISES, THE FIRM WHICH WAS DISSOLVED ON 20.11. 2011 PRIOR THE ISSUE OF SEARCH WARRANT. THE OBSERVATIONS OF THE AO WAS THAT ASSESS MENTS WERE FRAMED BY BELIEVING THAT SEARCH WARRANT WAS ISSUED TO M/S NAHAR ENTERP RISES (NOW KNOWN AS M/S NAHAR BUILDERS LTD) WHICH WAS CLERICAL MISTAKE WHILE PRE PARING PUNCHANAMA. THE FIRST APPELLATE AUTHORITY CONFIRMED THE ACTION OF THE AO ON THE GROUND THAT OLD COMPANY WAS MERGED INTO NEW COMPANY AND BOTH THE NAMES APPE AR IN THE PANCHANAMA. 12. NOW, THE ISSUE BEFORE US FOR ADJUDICATION IS AS TO WHETHER THE SEARCH WARRANT WAS ISSUED IN THE NAME OF DISSOLVED ENTITY OR THE EXIST ING COMPANY AND WHETHER THE CONSEQUENT ASSESSMENTS WERE VOID ABINITIO AND NON-E ST. IT IS AN ADMITTED FACT AND ALSO APPARENT FROM THE AO IN THE ASSESSMENT ORDER T HAT THE SEARCH WARRANT WAS ISSUED IN THE NAME OF THE ERSTWHILE FIRM I.E.NAHAR ENTERPRISES AND THE SAME IS EVIDENT FROM THE PUNCHANAMA ITSELF. THE AO OBSERVED THAT WHILE DRAWING UP THE PUNCHANAMA SOME CLERICAL MISTAKE OR BY ONE SIGHT TH E FULL NAME WAS NOT MENTIONED BUT JUST IT WAS MENTIONED AS NAHAR ENTERPRISES. IT IS THE OBSERVATION OF THE AO THAT IT IS A PROCEDURAL MISTAKE AND NO WAY AFFECTS THE LEGA LITY OF THE SEARCH AS THE WARRANT IS CORRECTLY ISSUED ACCORDING TO LAW. THE RELEVANT OBS ERVATIONS ARE AS UNDER : THE ABOVE ALLEGATION IS ABSOLUTELY UNFOUNDED, BAS ELESS AND ARBITRARY AND IT SEEMS HAS BEEN MADE WITH A MOTIVE TO DIVERT ATTENTION FROM THE MAI N ISSUE AND/ OR TO DILUTE THE SANCTITY OF SEARCH ACTION CONDUCTED U/S 132(1) OF THE INCOME TA X ACT, 1961. IN SUPPORT OF YOUR ALLEGATION YOU HAVE TAKEN SUPPOR T OF THE COPY OF PANCHNAMA ENCLOSED BY YOU. A PER THIS IN COL A IT IS WRITTEN AS- WARRA NT IN THE CASE OF NAHAR ENTERPRISES. THIS PANCHNAMA RELATES TO WARRANT NO.9303 AND WAS DRAWN AT NAHAR AMRIT SHAKTI (SALES OFFICE), CHANDIVALI FARM ROAD, NEAR CHANDIVALI STUDIO, ANDHE RI(E), MUMBAI-72. WHILE ENCLOSING THE SAID PANCHNAMA, YOU HAVE CONVEN IENTLY IGNORED WHAT IS WRITTEN ON THE WARRANT OF AUTHORISATIORI NO. 7303 WHICH IS THE MOS T IMPORTANT DOCUMENT. IT STATES THAT IT IS ISSUED TO- NAHAR ENTERPRISES (NOW KNOWN AS NAHAR BU ILDERS LTD). THUS THE SEARCH WARRANT HAS BEEN CORRECTLY ISSUED AND IS NOT IN THE NAME OF A PERSON OR AN ENTITY WHICH IS NOT IN EXISTENCE AS WRONGLY ALLEGED BY YOU. WHILE DRAWING UP THE PANCHNAMA, THERE APPEARS TO BE SOME CLERICAL MISTAKE OR OVERSIGHT IN WRITING THE F ULL NAME AND JUST NAHAR ENTERPRISES HAS BEEN MENTIONED. IT IS A PROCEDURAL MISTAKE AND NO W AY AFFECTS THE LEGALITY OF THE SEARCH AS THE WARRANT IS CORRECTLY ISSUED. THE OTHER WARRANT IN YOUR CASE I.E WARRANT NO. 9302 HAS ALSO BEEN ISSUED TO - NAHAR ENTERPRISES (NOW KNOWN AS NAHAR BUILDERS LTD) AND W AS DRAWN ON -B-1, MAHALAXMI CHAMBERS, 32, BHULABHAI DESAI ROAD, MAHALAXMI, MUMB AI-26. THERE WERE TWO PANCHNAMAS 14 DRAWN HERE I.E DATED 4.2.12 AND 23.2.12. IN BOTH TH ESE PANCHNAMA'S THE NAME HAS CORRECTLY BEEN WRITTEN AS - NAHAR ENTERPRISES (NOW KNOWN AS NAHAR BUILDERS LTD). THUS THERE IS NO MISTAKE EITHER IN THE WARRANT OR IN BOT H THE PANCHNAMAS. COPIES OF BOTH THESE PANACHNAMAS AND THE COPY OF WARRANT NO 9302 AND 930 3 ARE ENCLOSED FOR YOUR REFERENCE AND RECORD. THUS THERE IS NO BASIS TO YOUR ALLEGATION AND THE S AME IS THEREFORE NOT ACCEPTABLE AND IS REJECTED. 13.THE LD. CIT(A) CONFIRMED THE STAND OF THE AO FOR THE REASON THAT BOTH THE NAMES OF THE ENTITIES ARE MENTIONED ON PUNCHANAMA, AND TH EREFORE, THE PROCEEDINGS ARE VALID. WE FURTHER FIND THAT THE PANCHANAMA PREPARED ON 27.3.2012 WITH REFERENCE TO WARRANT NO.9302, THE WARRANT WAS ISSUED IN THE NAME OF NAHAR ENTERPRISES AND WE DO NOT SEE ANY MENTION OF NAHAR BUILDERS LTD. HOWEV ER, IN THE PANCHANAMA PREPARED ON 28.3.2012 WITH REFERENCE TO WARRANT NO. 9302, THERE IS A MENTION OF ASSESSEE FIRM NAME NAHAR ENTERPRISES (NOW KNOWN A S NAHAR BUILDERS LTD). WE FURTHER FIND THAT THE PAN OF NAHAR ENTERPRISES IS A AAFN1599D AND THE PAN OF NAHAR BUILDERS LTD IS AADCN8065A. THE ASSESSMENTS W ERE COMPLETED ON NAHAR ENTERPRISES WITH PAN AAAFN1599D. 14.IN OUR OPINION, THE SEARCH ACTION IS A STRICT AC TION TAKEN AGAINST THE PRIVACY OF ANY PERSON BY THE INVESTIGATING AND SEARCHING THE PREMI SES OF ANY PERSON WITH EXTREME POWERS BESTOWED ON THE DEPARTMENT. SEARCH ACTION U/ S 132(1) OF THE ACT CANNOT BE ALLOWED TO BE TAKEN PLACE WITHOUT PROPER EVIDENCE A ND INFORMATION IN THE HANDS OF THE DEPARTMENT. THE REVENUE IS EXPECTED TO EXERCISE UTMOST PRECAUTION WHILE EXERCISING THESE POWERS AS SEARCH ACTION IS NORMALL Y CONDUCTED AFTER DETAILED ENQUIRY AND INVESTIGATION BY INVESTIGATING AUTHORIT Y AFTER ANALYZING THE BACKGROUND OF GROUP COMPANIES, PARTNERS, AND DIRECTORS, THEIR PAN, RESIDENTIAL STATUS, ADDRESS ETC. WE ARE THEREFORE NOT IN AGREEMENT WITH THE CON CLUSION OF THE AUTHORITIES BELOW THAT MISTAKE IS SIMPLY A CLERICAL AND PROCEDURAL MI STAKE OF EITHER SIDE IN MENTIONING THE FULL NAME OF THE EXISTING ENTITY. MOREOVER, THE APPELLANT HAS DULY INFORMED THE DEPARTMENT VIDE ITS LETTER DATED 1.12.2011 WHICH WA S ACKNOWLEDGED BY THE OFFICE OF THE DY.CIT ON 1.12.2011 WITH REFERENCE TO THE DISSOLUTION OF THE FIRM. FOR THE SAKE OF CONVENIENCE, WE REPRODUCE THE LETTER DA TED 30.11.2011 INTIMATING THE AO ABOUT THE DISSOLUTION AS UNDER : UDANI MEHTA AND CO, CHARTERED ACCOUNTANTS TUSHAR D UDANI B.COM(HON)LLB(GEN),FCA, REF :NO:------------------- DATE NOVEMBER 30 TH , 2011 ACIT/NE/2011-12 TO, THE ASSTT.CIT, CIRCLE 16(2), MUMBAI. RE : M/S NAHAR ENTERPRISES, PAN AAAFN1599D, INTIMAT ION OF DISSOLUTION OF FIRM. WITH REFERENCE TO THE ABOVE AND UNDER INSTRUCTIONS FROM OUR CLIENTS AND AS REQUIRED U/S 176(3) WE HAVE TO INFORM YOU THAT CONSEQUENT TO CONVERSION OF THE FIRM, M/S NAHAR ENTERPRISES, INTO A COMPANY BY THE NAME OF M/S NAHAR BUILDERS LTD UNDE R PART IX OF THE COMPANIES ACT, 1956, THE ABOVE REFERRED FIRM HAS BEEN DISSOLVED W.E.F. END O F 20.11.2011. COPY OF THE DEED OF DISSOLUTION IS ENCLOSED HEREWITH. 15 THANKING YOU YOURS FAITHFULLY, (UDANI MEHTA) CA UNDER THESE CIRCUMSTANCES, WHEN THE DEPARTMENT HAS BEEN FULLY INFORMED ABOUT THE DISSOLUTION OF THE FIRM, NEW COMPANY HAS TAKEN OVER THE BUSINESS OF THE OLD FIRM BEFORE INITIATION OF SEARCH PROCEEDINGS, THAN THE I SSUE OF PUNCHANAMA IN THE NAME OF DISSOLVED FIRM CANNOT BE VALID. IN OUR OPIN ION, WHEN THE SEARCH UNDER SECTION 132 WAS CONDUCTED AND TO BE VALID, THE WARR ANT AND NOTICE SHOULD BE ISSUED IN THE NAME OF SUCCESSOR ONLY AND THE ASSESSMENT HA S TO BE MADE ON THE SUCCESSOR BUT IN THE PRESENT CASE PUNCHANCHAMA WAS DRAWN IN T HE NAME OF M/S NAHAR ENTERPRISES ON A NON- EXISTING ENTITY AND SO WAS TH E CASE AND IS NOT A CLERICAL MISTAKE. 15. ON A QUERY FROM THE BENCH TO LD.DR TO SATISFY R EGARDING THE SERVICE OF SEARCH WARRANT ON NAHAR BUILDERS LTD AND TO PLACE BEFORE T HE BENCH THE SAID SATISFACTION RESPECTIVELY, THE LD. DR DECLINED TO REPLY THE QUES TION BY SUBMITTING THAT THE BENCH HAS NO JURISDICTION TO CALL FOR SUCH RECORD AND EXP RESSED HIS INABILITY TO PLACE BEFORE THE BENCH. THEREFORE, IN THIS CASE SINCE THE DEPART MENT COULD NOT ESTABLISH THAT THE SEARCH WARRANT WAS ISSUED IN THE NAME OF THE SUCCES SOR ENTITY NAHAR BUILDERS LTD, WE THEREFORE INCLINED TO HOLD THAT THE ASSESSMENT P ROCEEDINGS INITIATED AND COMPLETED ON THE DISSOLVED ENTITY NAHAR ENTERPRISES ARE NULLITY IN THE EYES OF LAW AS HAS BEEN LAID DOWN IN THE VARIOUS DECISIONS DISCUSS ED HEREUNDER: 16. IN THE CASE OF SPICE INFOTAINMENT LTD. V. CIT [2012] 247 CTR 500 (DELHI), THE HONBLE HIGH COURT OF DELHI HAS HELD A S UNDER: 3. IN THIS BACKDROP, THE QUESTION THAT ARISES FOR CONSIDERATION IS AS TO WHETHER THE ASSESSMENT IN THE NAME OF A COMPANY WHICH HAD BEEN AMALGAMATED AND HAD BEEN DISSOLVED WITH THE SAID AMALGAMATING COMPANY WILL B E NULL AND VOID OR WHETHER FRAMING OF ASSESSMENT IN THE NAME OF SUCH A COMPANY IS A ME RE PROCEDURAL DEFECT WHICH CAN BE CURED. THE APPEALS WERE, THUS, FINALLY ADMITTED AND HEARD ON THE FOLLOWING QUESTIONS OF LAW : '(I) WHETHER ON THE FACTS AND IN THE CIRCUMST ANCES OF THE CASE, THE TRIBUNAL ERRED IN LAW IN HOLDING THAT THE ACTION OF THE AO IN FRAMING ASSESSMENT IN THE NAME OF 'SPICE CORP. LTD.', AFTER THE SAID ENTITY STOOD DISSOLVED CONSEQUENT UPON ITS AMALGAMATION WITH MCORP (P) LTD. W.E.F 1ST JULY, 2003, WAS A MERE PRO CEDURAL DEFECT ? (II) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE TRI BUNAL ERRED IN LAW IN HOLDING THAT IN VIEW OF THE PROVISIONS OF S. 292B OF THE ACT, THE A SSESSMENT, HAVING IN SUBSTANCE AND EFFECT, BEEN FRAMED ON THE AMALGAMATED COMPANY WHIC H COULD NOT BE REGARDED AS NULL AND VOID ?' 4. THE RATIONALE GIVEN BY THE TRIBUNAL, GIVING IT T O BE A MERE PROCEDURAL DEFECT IS SUMMED UP AS UNDER : (I)SPICE CORPORATION LTD. (THE AMALGAMATING COMPANY ) WAS AN INCOME-TAX ASSESSEE IN THE STATUS OF A COMPANY INCORPORATED UN DER THE PROVISIONS OF COMPANIES ACT, 1956. (II)THE AMALGAMATING COMPANY WAS IN EXISTENCE DURIN G THE RELEVANT ASST. YRS. 2002-03 AND 200304. (III)THE RETURNS OF INCOME FOR THESE ASSESSMENT YEA RS WERE FILED ON 30TH NOV., 2002 AND ON 30TH OCT., 2003 RESPECTIVELY BY M/S SPICE. (IV)THE SCHEME OF AMALGAMATING WAS SANCTIONED MUCH SUBSEQUENTLY ON 11TH FEB., 2004 BY THE HIGH COURT. (V)THE RETURN FILED BY M/S SPICE WAS SELECTED FOR S CRUTINY AND NOTICES WERE ISSUED. PURSUANT THERETO, THE AMALGAMATED COMPANY I.E. THE APPELLANT APPEARED AND PARTICIPATED IN THE PROCEEDINGS. EVEN THE ASSESSMEN T ORDERS WERE CHALLENGED BY THE APPELLANT/AMALGAMATED COMPANY. THUS, THE APPELL ANT ACCEPTED THAT THE ASSESSMENT PROCEEDINGS IN RESPECT OF THE ASSESSMENT OF SPICE FOR THE PERIOD PRIOR 16 TO ITS AMALGAMATION ARE BEING TAKEN UP AGAINST THE APPELLANT AND IT IS THE APPELLANT WHICH FELT AGGRIEVED OF THE ASSESSMENT ORDER AND PR EFERRED APPEAL. THE ORDER WAS THUS IN SUBSTANCE AND IN EFFECT, AGAINST THE APPELLANT/AMALGAMATED COMPANY. THE MERE OMISSION ON THE PART OF THE AO TO MENTION THE NAME OF THE APPELLANT/AMALGAMATED COMPANY IN PLACE OF M/S SPICE WAS, THEREFORE A PROCEDURAL DEFECT COVERED BY THE PROVISIONS OF S. 2 92B OF THE ACT 5. ACCORDING TO THE TRIBUNAL, IF THE SPICE WAS NON- EXISTENT, THERE WAS NO REASON FOR THE AMALGAMATED COMPANY TO REPRESENT THE SAME OR TO FEE L AGGRIEVED AGAINST THE SAID ORDER AND PREFER APPEAL AND GET THE SAME DECIDED ON MERIT S. IN OTHER WORDS, ANY APPEAL PREFERRED BY A NONEXISTENCE PERSON MUST ALSO BE TRE ATED AS NON EST. ALL THESE ACTS OF THE APPELLANTS/AMALGAMATED COMPANY CLEARLY SHOW THAT IT HAD BEEN CONSTANTLY TREATED THE ASSESSMENT MADE AGAINST THE APPELLANT IN RESPECT OF THE ASSESSMENT OF AMALGAMATED COMPANY. FURTHER, NO PREJUDICE IS CAUSED TO THE ASS ESSEE MERELY BECAUSE IN THE BODY OF THE ASSESSMENT ORDER NAME OF THE AMALGAMATED COMPAN Y IS NOT SHOWN. 6.ON THE AFORESAID REASONING AND ANALYSIS, THE TRIB UNAL SUMMED UP THE POSITION IN PARA 14 OF ITS ORDER WHICH READS AS UNDER : 'IN THE LIGH T OF THE DISCUSSIONS MADE ABOVE, WE, THEREFORE, HOLD THAT THE ASSESSMENT MADE BY THE AO, IN SUBSTANCE AND EFFECT, IS NOT AGAINST THE NON-EXISTENT AMALGAMATING COMPANY. HOWE VER, WE DO AGREE WITH THE PROPOSITION OR RATIO DECIDED IN THE VARIOUS CASES R ELIED UPON BY THE LEARNED COUNSEL FOR THE ASSESSEE THAT THE ASSESSMENT MADE AGAINST NON-EXIST ENT PERSON WOULD BE INVALID AND LIABLE TO BE STRUCK DOWN. BUT, IN THE PRESENT CASE, WE FIND THAT THE ASSESSMENT, IN SUBSTANCE AND EFFECT, HAS BEEN MADE AGAINST AMALGAM ATED COMPANY IN RESPECT OF ASSESSMENT OF INCOME OF AMALGAMATING COMPANY FOR TH E PERIOD PRIOR TO AMALGAMATION AND MERE OMISSION TO MENTION THE NAME OF AMALGAMATED CO MPANY ALONG WITH THE NAME OF AMALGAMATING COMPANY IN THE BODY OF ASSESSMENT AGAI NST THE ITEM 'NAME OF THE ASSESSEE' IS NOT FATAL TO THE VALIDITY OF ASSESSMEN T BUT IS A PROCEDURAL DEFECT COVERED BY S. 292B OF THE ACT. WE HOLD ACCORDINGLY.' 7.THE AFORESAID LINE OF REASONING ADOPTED BY THE TR IBUNAL IS CLEARLY BLEMISHED WITH LEGAL LOOPHOLES AND IS CONTRARY TO LAW. NO DOUBT, M/S SPI CE WAS AN ASSESSEE AND AS AN INCORPORATED COMPANY AND WAS IN EXISTENCE WHEN IT F ILED THE RETURNS IN RESPECT OF TWO ASSESSMENT YEARS IN QUESTION, HOWEVER, BEFORE THE C ASE COULD BE SELECTED FOR SCRUTINY AND ASSESSMENT PROCEEDINGS COULD BE INITIATED, M/S SPICE GOT AMALGAMATED WITH MCORP (P) LTD. IT WAS THE RESULT OF THE SCHEME OF THE AMA LGAMATION FILED BEFORE THE COMPANY JUDGE OF THIS COURT WHICH WAS DULY SANCTIONED VIDE ORDERS DT. 11TH FEB., 2004 . WITH THIS AMALGAMATION MADE EFFECTIVE FROM 1ST JULY, 2003, M/ S SPICE CEASED TO EXIST. THAT IS THE PLAIN AND SIMPLE EFFECT IN LAW. THE SCHEME OF AMALG AMATION ITSELF PROVIDED FOR THIS CONSEQUENCE, INASMUCH AS SIMULTANEOUS WITH THE SANC TIONING OF THE SCHEME, M/S SPICE WAS ALSO STOOD DISSOLVED BY SPECIFIC ORDER OF THIS COURT. WITH THE DISSOLUTION OF THIS COMPANY, ITS NAME WAS STRUCK OFF FROM THE ROLLS OF COMPANIES MAINTAINED BY THE ROC. 8.A COMPANY INCORPORATED UNDER THE INDIAN COMPANIES ACT IS A JURISTIC PERSON. IT TAKES ITS BIRTH AND GETS LIFE WITH THE INCORPORATION. IT DIES WITH THE DISSOLUTION AS PER THE PROVISIONS OF THE COMPANIES ACT. IT IS TRITE LAW THAT ON AMALG AMATION, THE AMALGAMATING COMPANY CEASES TO EXIST IN THE EYES OF LAW. THIS POSITION I S EVEN ACCEPTED BY THE TRIBUNAL IN PARA 14 OF ITS ORDER EXTRACTED ABOVE. HAVING REGARD TO T HIS CONSEQUENCE PROVIDED IN LAW, IN NUMBER OF CASES, THE SUPREME COURT HELD THAT ASSESS MENT UPON A DISSOLVED COMPANY IS IMPERMISSIBLE AS THERE IS NO PROVISION IN INCOME-TA X CAN TO MAKE AN ASSESSMENT THEREUPON. IN THE CASE OF SARASWATI INDUSTRIAL SYND ICATE LTD. VS. CIT (1990) 88 CTR (SC) 61 : (1990) 186 ITR 278 (SC) THE LEGAL POSITIO N IS EXPLAINED IN THE FOLLOWING TERMS : 'THE QUESTION IS WHETHER ON THE AMALGAMATION OF THE INDIAN SUGAR COMPANY WITH THE APPELLANT COMPANY, THE INDIAN SUGAR COMPANY CONTINU ED TO HAVE ITS ENTITY AND WAS ALIVE FOR THE PURPOSES OF S. 41(1) OF THE ACT ? THE AMALG AMATION OF THE TWO COMPANIES WAS EFFECTED UNDER THE ORDER OF THE HIGH COURT IN PROCE EDINGS UNDER S. 391 R/W S. 394 OF THE COMPANIES ACT. THE SARASWATI INDUSTRIAL SYNDICATE, THE TRANSFEREE COMPANY WAS A SUBSIDIARY OF THE INDIAN SUGAR COMPANY, NAMELY, THE TRANSFEROR COMPANY. UNDER THE SCHEME OF AMALGAMATION THE INDIAN SUGAR COMPANY STO OD DISSOLVED ON 29TH OCT., 1962 AND IT CEASED TO BE IN EXISTENCE THEREAFTER. T HOUGH THE SCHEME PROVIDED THAT THE TRANSFEREE COMPANY THE SARASWATI INDUSTRIAL SYNDICA TE LTD. UNDERTOOK TO MEET ANY LIABILITY OF THE INDIAN SUGAR COMPANY WHICH THAT CO MPANY INCURRED OR IT COULD INCUR, ANY LIAIBLITY, BEFORE THE DISSOLUTION OR NOT THEREAFTER . GENERALLY, WHERE ONLY ONE COMPANY IS INVOLVED IN CHANGE AND THE RIGHTS OF THE SHAREHOLDE RS AND CREDITORS ARE VARIED, IT 17 AMOUNTS TO RECONSTRUCTION OR REORGANISATION OF SCHE ME OF ARRANGEMENT. IN AMALGAMATION TWO OR MORE COMPANIES ARE FUSED INTO ONE BY MERGER OR BY TAKING OVER BY ANOTHER. 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 SHAREHOLD ERS IN THE COMPANY WHICH IS TO CARRY ON THE BLENDED UNDERTAKINGS. THERE MAY BE AMALGAMATION EITHER BY THE TRANSFER OF TWO OR MORE UNDERTAKINGS TO A NEW COMPANY, OR BY TH E TRANSFER OF ONE OR MORE UNDERTAKINGS TO AN EXISTING COMPANY. STRICTLY AMALG AMATION DOES NOT COVER THE MERE ACQUISITION BY A COMPANY OF THE SHARE CAPITAL OF OT HER COMPANY WHICH REMAINS IN EXISTENCE AND CONTINUES ITS UNDERTAKING BUT THE CON TEXT IN WHICH THE TERM IS USED MAY SHOW THAT IT IS INTENDED TO INCLUDE SUCH AN ACQUISI TION. SEE HALSBURYS LAWS OF ENGLAND 4TH EDITION VOL. 7 PARA 1539. TWO COMPANIES MAY JOI N TO FORM A NEW COMPANY, BUT THERE MAY BE ABSORPTION OR BLENDING OF ONE BY THE OTHER, BOTH AMOUNT TO AMALGAMATION. WHEN TWO COMPANIES ARE MERGED AND ARE SO JOINED, AS TO F ORM A THIRD COMPANY OR ONE IS ABSORBED INTO ONE OR BLENDED WITH ANOTHER, THE AMAL GAMATING COMPANY LOSES ITS ENTITY.' 9.THE COURT REFERRED TO ITS EARLIER JUDGMENT IN GEN ERAL RADIO & APPLIANCES CO. LTD. VS. M.A. KHADER (1986) 60 COMP CAS 1013 (SC). IN VIEW O F THE AFORESAID CLINCHING POSITION IN LAW, IT IS DIFFICULT TO DIGEST THE CIRCUITOUS ROUTE ADOPTED BY THE TRIBUNAL HOLDING THAT THE ASSESSMENT WAS IN FACT IN THE NAME OF AMALGAMATED C OMPANY AND THERE WAS ONLY A PROCEDURAL DEFECT. 10.SEC. 481 OF THE COMPANIES ACT PROVIDES FOR DISSO LUTION OF THE COMPANY. THE COMPANY JUDGE IN THE HIGH COURT CAN ORDER DISSOLUTI ON OF A COMPANY ON THE GROUNDS STATED THEREIN. THE EFFECT OF THE DISSOLUTION IS TH AT THE COMPANY NO MORE SURVIVES. THE DISSOLUTION PUTS AN END TO THE EXISTENCE OF THE COM PANY. IT IS HELD IN M.H. SMITH (PLANT HIRE) LTD. VS. D.L. MAINWARING (T/A INSHORE) (1986) BCLC 342 (CA) THAT 'ONCE A COMPANY IS DISSOLVED IT BECOMES A NON-EXISTENT PARTY AND THERE FORE NO ACTION CAN BE BROUGHT IN ITS NAME. THUS AN INSURANCE COMPANY WHICH WAS SUBROGATE D TO THE RIGHTS OF ANOTHER INSURED COMPANY WAS HELD NOT TO BE ENTITLED TO MAIN TAIN AN ACTION IN THE NAME OF THE COMPANY AFTER THE LATTER HAD BEEN DISSOLVED'. 11.AFTER THE SANCTION OF THE SCHEME ON 11TH FEB., 2 004, THE SPICE CEASED TO EXIST W.E.F. 1ST JULY, 2003. EVEN IF SPICE HAD FILED THE RETURNS , IT BECAME INCUMBENT UPON THE IT AUTHORITIES TO SUBSTITUTE THE SUCCESSOR IN PLACE OF THE SAID 'DEAD PERSON'. WHEN NOTICE UNDER S. 143(2) WAS SENT, THE APPELLANT/AMALGAMATED COMPANY APPEARED AND BROUGHT THIS FACT TO THE KNOWLEDGE OF THE AO. HE, HOWEVER, DID NOT SUBSTITUTE THE NAME OF THE APPELLANT ON RECORD. INSTEAD, THE AO MADE T HE ASSESSMENT IN THE NAME OF M/S SPICE WHICH WAS NON-EXISTING ENTITY ON THAT DAY. IN SUCH PROCEE DINGS AN 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 BY THE APPELL ANT WOULD BE OF NO EFFECT AS THERE IS NO ESTOPPEL AGAINST LAW. 12.ONCE IT IS FOUND THAT ASSESSMENT IS FRAMED IN TH E NAME OF NON- EXISTING ENTITY, IT DOES NOT REMAIN A PROCEDURAL IRREGULARITY OF THE NATURE WHICH COULD BE CURED BY INVOKING THE PROVISIONS OF S. 292B OF THE ACT. SEC. 292B OF THE ACT READS AS UNDER : '292B. NO RETURN OF INCOME ASSESSMENT, NOTICE, SUMMONS OR OTHER PROC EEDINGS 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 SHAL L BE INVALID OR SHALL BE DEEMED TO BE INVALID MERELY BY REASONS OF ANY MISTAKE, DEFECT OR OMISSION IN SUCH RETURN OF INCOME, ASSESSMENT, NOTICE, SUMMONS OR OTHER PROCEEDING IF SUCH RETURN OF INCOME, ASSESSMENT, NOTICE, SUMMONS OR OTHER PROCEEDINGS IS IN SUBSTANCE AND EFFECT IN CONFORMITY WITH OR ACCORDING TO THE INTENT AND PURP OSE OF THIS ACT. 13.THE PUNJAB & HARYANA HIGH COURT STATED THE EFFEC T OF THIS PROVISION IN CIT VS. NORTON MOTORS (2006) 200 CTR (P&H) 604 : (2005) 275 ITR 595 (P&H) IN THE FOLLOWING MANNER : 'A READING OF THE ABOVE REPRODUCED PROVISION MAKES IT CLEAR THAT A MISTAKE, DEFECT OR OMISSION IN THE RETURN OF INCOME, ASSESSMENT, NOTIC E, SUMMONS OR OTHER PROCEEDING IS NOT SUFFICIENT TO INVALIDATE AN ACTION TAKEN BY THE COMPETENT AUTHORITY, PROVIDED THAT SUCH RETURN OF INCOME, ASSESSMENT, NOTICE, SUMMONS OR OT HER PROCEEDING IS IN SUBSTANCE AND EFFECT IN CONFORMITY WITH OR ACCORDING TO THE PROVI SIONS OF THE ACT. TO PUT IT DIFFERENTLY, S. 292B CAN BE RELIED UPON FOR RESISTING A CHALLENGE T O THE NOTICE, ETC., ONLY IF THERE IS A TECHNICAL DEFECT OR OMISSION IN IT. HOWEVER, THERE IS NOTHING IN THE PLAIN LANGUAGE OF THAT SECTION FROM WHICH IT CAN BE INFERRED THAT THE SAME CAN BE RELIED UPON FOR CURING A JURISDICTIONAL DEFECT IN THE ASSESSMENT NOTICE, SUM MONS OR OTHER PROCEEDING. IN OTHER 18 WORDS, IF THE NOTICE, SUMMONS OR OTHER PROCEEDING T AKEN BY AN AUTHORITY SUFFERS FROM AN INHERENT LACUNA AFFECTING HIS/ITS JURISDICTION, THE SAME CANNOT BE CURED BY HAVING RESORT TO S. 292B.' 17. IN THE CASE OF CIT V/S INTEL TECHNOLOGY INDIA ( P.) LTD. [2016] 380 ITR 272 (KARNATAKA), THE HONBLE HIGH COURT OF KARNATAKA HE LD AS UNDER : 5. THE TRIBUNAL HAD REJECTED THE CLAIM OF THE DEPARTME NT ON THE GROUND THAT THE ASSESSMENT PROCEEDINGS AGAINST SSS LIMITED (WHICH WAS NON-EXIS TENT ON THE DATE OF PASSING OF THE ASSESSMENT ORDER) CANNOT BE HELD TO BE VALID PROCEEDINGS, LEAR NED COUNSEL FOR THE APPELLANT HAS SUBMITTED THAT TH E RETURN OF INCOME HAD BEEN FILED BY THE ASSESSEE-SS S LIMITED MUCH PRIOR TO THE AMALGAMATION ORDER DATED 1.4.2004 AND AS SUCH, THE PROCEEDINGS WOULD C ONTINUE AGAINST THE SAID COMPANY EVEN AFTER THE AMALGAMATION, ESPECIALLY WHEN THE SUCCESSOR COMPANY - M/S INTEL TECHNOLOGY INDIA PVT. LTD. HAD PARTICIPATED IN THE PROCEEDINGS. LEARNED COUNSEL FO R THE APPELLANT FURTHER SUBMITS THAT THE DEPARTMENT WOULD BE ENTITLED TO THE BENEFIT OF SECTION 292(B) OF THE INCOME TAX ACT. 6. ON THE OTHER HAND, LEARNED COUNSEL FOR THE RESPONDE NT HAS SUBMITTED THAT ANY PROCEEDING AGAINST A NON-EXISTING COMPANY WOULD BE NULL AND VOID, ESPECI ALLY AFTER THE RESPONDENT/COMPANY (WHICH HAD SUCCEEDED M/S SSS LIMITED) HAD GIVEN NOTICE OF AMAL GAMATION TO THE DEPARTMENT ON 29.6.2004. IT IS THUS SUBMITTED THAT AFTER THE ISSUANCE OF THE DEMAN D NOTICE, IT WAS FOR THE DEPARTMENT TO SUBSTITUTE T HE RESPONDENT COMPANY IN THE PROCEEDINGS FOR ASSESSMEN T AND BY NOT HAVING DONE SO, THE ENTIRE ASSESSMENT PROCEEDINGS WOULD BE NULL AND VOID. IN S UPPORT OF HIS SUBMISSION, LEARNED COUNSEL FOR THE RESPONDENT HAS PLACED RELIANCE ON A DIVISION BENCH DECISION OF THE DELHI HIGH COURT RENDERED IN SPICE INFOTAINMENT LTD. V. CIT [IT APPEAL NOS. 475 & 476 OF 2011, DATED 3-8-2011]. IT IS CONTENDED THAT THE FACTS OF THE PRESENT CASE ARE SIMILAR, IF NOT IDENTICAL, TO THE FACTS IN THE CASE OF SPICE INFOTAINMENT LTD. ( SUPRA ) WHEREIN THE DELHI HIGH COURT HAS, AFTER CONSIDERI NG THE VARIOUS PROVISIONS OF THE INCOME TAX ACT AS WELL AS CERTAIN DECISIONS OF THE APEX COURT AND OTHER HIGH COURTS, CLEARLY HELD THAT THE FRAMING OF ASSESSMENT AGAINST THE NON -EXISTING ENTITY/PERSON GOES TO THE ROOT OF THE MATTER WHICH IS NOT A PROCEDURAL IRREGULARITY, BUT, A JURISDICTIONAL DEFECT AND AS THERE CANNOT BE ANY ASSESSMENT AGAINST THE DEAD PERSON. 7. IN THE PRESENT CASE ALSO, THE PROCEEDINGS HAD BEEN INITIATED AGAINST A NON-EXISTING COMPANY/SSS LIMITED EVEN AFTER THE AMALGAMATION OF THE SAID COM PANY WITH M/S INTEL TECHNOLOGY INDIA PVT. LTD.. WE DO NOT SEE ANY GOOD GROUND TO DIFFER WITH THE SA ID JUDGMENT OF THE DELHI HIGH COURT. 8. ACCORDINGLY, FOR THE REASONS GIVEN IN THE JUDGME NT OF THE DELHI HIGH COURT IN THE CASE OF SPICE INFOTAINMENT LTD. ( SUPRA ), THESE APPEALS ARE DISMISSED AND WE DECIDE THE SU BSTANTIAL QUESTIONS OF LAW IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. 18. IN THE CASE OF CIT V/S MICRON STEELS (P.) LTD. [2015] 372 ITR 386 (DELHI), THE HONBLE HIGH COURT OF DELHI HELD AS UNDER: THE REVENUE IN THESE APPEALS CLAIMS TO BE AGGRIEVE D BY THE ORDER OF THE INCOME-TAX APPELLATE TRIBUNAL ('THE ITAT'), DATED FEBRUARY 19, 2013. THE INCOME-TAX APPELLATE TRIBUNAL HAD AFFIRMED THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEAL S) WHO HAD SET ASIDE THE BLOCK ASSESSMENT OF M/S. MICRON STEELS PVT. LTD. (THE ORIGINAL ASSESSEE WHICH SUBSEQUENTLY AMALGAMATED WITH M/S. LAKHANPAL INFRASTRUCTURE PVT. LTD. WITH EFFECT FROM FEBRUARY 1, 2008, BY VIRTUE OF AN ORDER DATED FEBRUARY 19, 2010). THE ASSESSMENT YEARS IN QUESTIO N ARE 2003-04 TO 2008-09. 2.THE GROUNDS ON WHICH THE COMMISSIONER OF INCOME-T AX (APPEALS) AND LATER THE INCOME-TAX APPELLATE TRIBUNAL SET ASIDE THE ASSESSMENT WAS THA T THE ASSESSEE HAD AMALGAMATED WITH M/S. LAKHANPAL INFRASTRUCTURE PVT. LTD. AND NEITHER WAS IT ASSESSED IN THE RELATIVE PERIODS AND THAT THE AMALGAMATION OF THE ORIGINAL ASSESSEE CORPORATE HAD RENDERED THE ASSESSMENT FRAMED AGAINST IT AS VOID. 3.THE FACTS RELEVANT FOR DECIDING THIS APPEAL ARE T HAT ON OCTOBER 20, 2008, A SEARCH AND SEIZURE ACTIO N WAS CONDUCTED IN THE CASES OF B.K. DHINGRA, SMT. PO ONAM DHINGRA, M/S. MADHUSUDAN BUILDCON PVT. LTD. AND OTHERS CONNECTED. BASED UPON THE SAID SEAR CH, AND THE MATERIALS SECURED DURING THAT PROCEEDINGS, BLOCK ASSESSMENTS WERE FINALISED IN RE SPECT OF THOSE ASSESSEES. THE ASSESSING OFFICER ('THE AO') WAS OF THE OPINION THAT DURING THE COURS E OF THE SEARCH, MATERIALS WERE SEIZED WHICH BELONGED TO THE RESPONDENTS-ASSESSEES AND, ACCORDIN GLY, ISSUED NOTICE TO M/S. MICRON STEELS PVT. LTD. ON JULY 6, 2010. BY THAT TIME, M/S. MICRON STEELS P VT. LTD. AS NOTICED AT THE OUTSET IN THIS JUDGMENT HAD BEEN AMALGAMATED WITH M/S. LAKHANPAL INFRASTRUC TURE PVT. LTD. THE ASSESSMENT WAS FINALISED ON DECEMBER 31, 2010, BY THE ASSESSING OFFICER. IN THE COURSE OF ASSESSMENT, VARIOUS ADDITIONS WERE MADE. THIS WAS THE SUBJECT-MATTER OF APPEAL TO THE COMMIS SIONER OF INCOME- TAX (APPEALS). IT WAS URGED IN THE APPEAL THAT ON ACCOUNT OF AMALGAMATION AND BY O PERATION OF SECTION 170 OF THE INCOME-TAX ACT THE INCOME-TAX AUTHORITIES WERE UNDER A DUTY, UPON RECEIPT OF INFORMATION, TO INITIATE COMPLETE 19 PROCEEDINGS AGAINST THE TRANSFEREE COMPANY WHICH TH EY HAD NOT DONE. THIS PLEA WAS ACCEPTED BY THE COMMISSIONER OF INCOME-TAX (APPEALS), WHO, INTER AL IA, NOTED THAT ON OCTOBER 19, 2010, SINCE THE ASSESSING OFFICER CHANGED, ON ACCOUNT OF AN ADMINIS TRATIVE ORDER, AN INTIMATION WAS RECEIVED BY THE ASSESSING OFFICER ON NOVEMBER 18, 2010, STATING THA T M/S. MICRON STEELS PVT. LTD. NO LONGER EXISTED ON ACCOUNT OF THE AMALGAMATION ORDER, DATED FEBRUAR Y 19, 2010. THE COMMISSIONER OF INCOME-TAX (APPEALS) GUIDED BY VARIOUS PREVIOUS DECISIONS OF T HIS COURT, FORMED THE OPINION THAT THE CONTENTIONS OF THE RESPONDENT-ASSESSEE WAS SUBSTANTIAL AND THAT THE ASSESSMENT ORDERS AS FRAMED, WERE UNSUSTAINABLE. HE, ACCORDINGLY, SET ASIDE THE ASSES SMENT ORDER. 4.THE REVENUE'S APPEAL WAS REJECTED. THE INCOME-TAX APPELLATE TRIBUNAL RELIED UPON SEVERAL JUDGMENTS INCLUDING ONE OF THE DIVISION BENCH OF TH IS COURT IN SPICE ENTERTAINMENT LTD. V. CST [I.T. APPEAL NO. 475 OF 2011, DATED AUGUST 3, 2011] THE I NCOME-TAX APPELLATE TRIBUNAL HELD AS FOLLOWS : '8. WE HAVE CAREFULLY CONSIDERED THE SUBMISSION IN THIS REGARD AND PERUSED THE RECORDS. WE FULLY CONCUR WITH THE FINDING OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) THAT A COMPANY INCORPORATED UNDER THE INDIAN COMPANIES ACT IS A JU RISTIC PERSON. IT TAKES ITS BIRTH AND GETS LIFE WIT H INCORPORATION AND IT DIES WITH THE DISSOLUTION AS P ER THE PROVISIONS OF THE COMPANIES ACT. ON AMALGAMATION, THE COMPANY CEASES TO EXIST IN THE EY E OF THE LAW. THUS, ASSESSMENT UPON A DISSOLVED COMPANY IS IMPERMISSIBLE AS THERE IS NO PROVISION I N THE INCOME-TAX ACT TO MAKE AN ASSESSMENT THEREUPON. THE LEARNED COMMISSIONER OF INCOME-TAX ( APPEALS), IN OUR VIEW, HAS, THEREFORE, RIGHTLY HELD THAT THE ASSESSMENT ON A COMPANY WHICH HAS BEE N DISSOLVED BY AMALGAMATION UNDER SECTIONS 391 AND 394 OF THE COMPANIES ACT, 1956, IS INVALID. ADMITTEDLY, THE ASSESSEE-COMPANY IN THE PRESENT CASE STOOD DISSOLVED ON SEPTEMBER 19, 2010, ON AMALGAMATION WITH M/S. LAKHANPAL INFRASTRUCTURE PVT. LTD. AND THE ASSESSMENT ORDER I N THE PRESENT CASE WAS FRAMED ON DECEMBER 31, 2010. HENCE, WE UPHOLD THE ORDER OF THE LEARNED COM MISSIONER OF INCOME-TAX (APPEALS). 9. IN VIEW OF THE ABOVE FINDING ON THE MAINTAINABIL ITY OF THE ASSESSMENT ORDER ITSELF, WHICH HAS BEEN HELD TO BE A NULLITY, THE ISSUE RAISED IN THE OTHER GROUNDS OF APPEALS PREFERRED BY THE REVENUE AND CROSS-OBJECTIONS RAISED BY THE ASSESSEE HAVE BECOME INFRUCTUOUS AND THEY DON'T NEED ADJUDICATION.' 5.IT IS URGED ON BEHALF OF THE REVENUE THAT THE ASS ESSMENT AS FRAMED COULD NOT HAVE BEEN SET ASIDE. TO SAY SO, THE LEARNED COUNSEL, FIRSTLY, CONTENDED THAT THE ASSESSING OFFICER TOOK NOTE OF THE FACT TH AT THE M/S. MICRON STEELS PVT. LTD. HAD BEEN AMALGAMAT ED AS IS EVIDENT FROM THE FACT THAT THE ASSESSMENT WAS FRAMED IN RESPECT OF 'MICRON STEELS' , AND, CONSEQUENTLY, THE ASSESSEE EFFECTIVELY PARTICIPATED AND MADE ITS VIEW ON ITS OWN AND FILED ITS RETURN. LEARNED COUNSEL CONTENDED THAT THE OPERATION OF SECTION 292B, THEREFORE, PRECLUDED THE ASSESSEE'S CONTENTION WITH REGARD TO NULLITY OF TH E ENTIRE PROCEEDINGS. 6.THIS COURT NOTICES, AT THE OUTSET, THAT THE ISSUE URGED IS NO LONGER RES INTEGRA. AS STATED EARLIER, SPICE ENTERTAINMENT LTD. (SUPRA) IS AN AUTHORITY FOR THE PROPOSITION THAT COMPLETION OF ASSESSMENT IN RESPECT OF A NON-EXISTENT COMPANY, DUE TO THE AMALG AMATION ORDER, WOULD RENDER ASSESSMENT IN THE NAME AND IN RESPECT OF THE ORIGINAL ASSESSEE- COMPA NY, A NULLITY. IN SPICE ENTERTAINMENT LTD. (SUPRA), AFTER REFERRING TO SARASWATI INDUSTRIAL SYNDICATE L TD. V. CIT [1990] 186 ITR 278/53 TAXMAN 92 (SC), THIS COURT HELD AS FOLLOWS : '9. THE COURT REFERRED TO ITS EARLIER JUDGMENT IN G ENERAL RADIO AND APPLIANCES CO. LTD. V. M.A. KHADER [1986] 60 COMP CAS 1013 (SC). IN VIEW OF THE AFORESAID CLINCHING POSITION IN LAW, IT IS DIFFICULT TO DIGEST THE CIRCUITOUS ROUTE ADOPTED BY THE TRIBUNAL HOLDING THAT THE ASSESSMENT WAS IN FA CT IN THE NAME OF AMALGAMATED COMPANY AND THERE WAS ON LY A PROCEDURAL DEFECT. 10. SECTION 481 OF THE COMPANIES ACT PROVIDES FOR D ISSOLUTION OF THE COMPANY. THE COMPANY JUDGE IN THE HIGH COURT CAN ORDER DISSOLUTION OF A COMPAN Y ON THE GROUNDS STATED THEREIN. THE EFFECT OF THE DISSOLUTION IS THAT THE COMPANY NO MORE SURVIVES. T HE DISSOLUTION PUTS AN END TO THE EXISTENCE OF THE COMPANY. IT IS HELD IN M.H. SMITH (PLANT HIRE) LTD. V. D.L. MAINWARING (T/A INSHORE) [1986] BCLC 342 (CA) THAT 'ONCE A COMPANY IS DISSOLVED IT BECOMES A NON-EXISTENT PARTY AND, THEREFORE, NO ACTION CAN BE BROUGHT IN ITS NAME. THUS, AN INSURAN CE COMPANY WHICH WAS SUBROGATED TO THE RIGHTS OF ANOTHER INSURED COMPANY WAS HELD NOT TO BE ENTITLED TO MAINTAIN AN ACTION IN THE NAME OF THE COMPANY AFTER THE LATTER HAD BEEN DISSOLVED. 19.IN THE CASE OF CIT V/S MICRA INDIA (P) LTD (2015 ) 231 TAXMAN 809 (DELHI), THE HONBLE DELHI HIGH COURT HAS HELD AS UNDER: 10. IN THE PRESENT CASE, NO DOUBT THERE WAS PARTICI PATION DURING THE COURSE OF ASSESSMENT; HOWEVER, THE AO, DESPITE BEING TOLD THAT THE ORIGINAL COMPAN Y WAS NO LONGER IN EXISTENCE, DID NOT TAKE REMEDIAL MEASURES AND DID NOT TRANSPOSE THE TRANSFE REE AS THE COMPANY WHICH HAD TO BE ASSESSED. INSTEAD, HE RESORTED TO A PECULIAR PROCEDURE OF DES CRIBING THE ORIGINAL ASSESSEE AS THE ONE IN EXISTENCE; THE ORDER ALSO MENTIONED THE TRA NSFEREE'S NAME BELOW THAT OF M/S M ICRA INDIA PVT. LTD. NOW, THAT DID NOT LEAD TO THE ASSES SMENT BEING COMPLETED IN THE NAME OF THE 20 TRANSFEREE COMPANY. ACCORDING TO THE AO, M/S MICRA INDIA PVT. LTD. WAS STILL IN EXISTENCE. CLEARLY, THIS WAS A CASE WHERE THE ASSESSMENT WAS CONTRARY T O LAW, AS HAVING BEING COMPLETED AGAINST A NON- EXISTENT COMPANY. THE ITAT'S DECISION IS, IN THE CI RCUMSTANCES, JUSTIFIED AND WARRANTED. 11. FOR THE ABOVE REASONS IT IS HELD THAT THESE APP EALS DO NOT INVOLVE ANY SUBSTANTIAL QUESTION OF LAW AND OF LIABILITY. THE APPEALS ARE ACCORDINGLY DISMI SSED. THEREFORE, FOLLOWING THE ABOVE DECISIONS, WE HOLD T HAT THE ASSESSMENT MADE U/S 143(3) R.W.S.153A ARE BAD IN LAW BEING NULLITY IN T HE EYES OF LAW AS THE SEARCH WARRANT WAS ISSUED IN THE NAME OF NON-EXISTING ENTI TY. THE GROUND NO 1 IS ACCORDINGLY ALLOWED. 20. THE ISSUE RAISED BY THE ASSESSEE IN THE SECOND GROUND OF APPEAL IS WITH RESPECT TO APPOINTMENT OF DVO BEING BAD IN LAW AND THEREFORE, THE VALUATION REPORT PREPARED BY THE DVO WHICH WAS RELIED UPON BY THE LOWER AUTHO RITIES WAS ALSO BAD IN LAW. 21.THE FACTS OF THE CASE ARE THAT AFTER SEARCH PROC EEDINGS THE MATTER WAS REFERRED TO THE DVO FOR VALUATION, WHICH WAS DULY SUBMITTED BY THE DVO AND RELIED UPON BY THE AO AND ALSO IN THE FIRST APPELLATE PROCEEDINGS. THE ASSESSEE OBJECTED TO THE APPOINTMENT OF THE DVO ON THE GROUND THAT THE DVO W AS NOT A MEMBER OF SEARCH PARTY AND THEREFORE THE REPORT PREPARED BY THE DVO COULD NOT BE RELIED UPON. 22.WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIO NS AND PERUSED THE MATERIAL PLACED BEFORE US. WE FIND THAT THE VALUATION OFFICE WAS ENGAGED BY THE DEPARTMENT FROM CENTRAL PUBLIC WORKS DEPARTMENT, GOVERNMENT OF INDIA, WHO WAS TECHNICAL EXPERT. AFTER PERUSING THE PROVISIONS OF SECTION 13 2(2) OF THE ACT, WE FIND IN THE SEARCH CASES IT IS USUALLY TO TAKE OPINION OF TECHN ICAL EXPERTS FROM THE QUALIFIED ENGINEERS WORKING IN CPDW. IN THE CASE BEFORE US, T HE SERVICES OF DVO WAS TAKEN FOR THE MEASUREMENTS OF FLATS WHICH IN OUR OPINION, NO OTHER PERSON COULD HAVE DONE BETTER WAY AS THE MATTER BEING HIGHLY TECHNICAL. WE ALSO FIND THAT DUE OPPORTUNITY WAS GIVEN TO THE ASSESSEE BY THE DEPARTMENT TO CONT ROVERT THE FINDING OF THE AO BY GIVING COPY OF THE VALUATION REPORT, SO, IN VIEW OF THESE FACTS WE ARE OF THE CONSIDERED VIEW THAT THE GROUND RAISED BY THE ASSES SEE HAS NO SUBSTANCE AND THEREFORE, THE GROUND RAISED BY THE ASSESSEE IS DIS MISSED. 24.ON MERITS THE ASSESSEE CHALLENGED THE ORDER OF T HE LD.CIT(A) IN DENYING THE CLAIM FOR DEDUCTION U/S 80IB(10) FOR INCLUDING THE FLOWER BED AREA WHICH IS OPEN TO SKY AND NOT ON FLOOR LEVEL AND 50% OF COMMON WALL AREA AS PART OF BUILT UP AREA PRESCRIBED UNDER SECTION 80IB(14) OF THE ACT. THE A O WHILE COMPLETING THE ASSESSMENT INCLUDED THE SERVICE AREA, WINDOW PROJEC TION, CUPBOARD PROJECTION, SUNKEN AREA (FLOWER BED) AND COMMON WALL AREA IN AR RIVING AT THE ELIGIBLE LIMIT OF 1000 SQ.FT. OF BUILT UP AREA OF EACH FLAT. THE AO O BSERVED THAT AFTER INCLUSION OF THESE AREAS IN BUILT UP AREA, THE TOTAL BUILT UP AR EA IS EXCEEDING 1000 SQ.FT AND THEREFORE HE DENIED THE ASSESSEE THE BENEFIT OF DED UCTION 80IB(10) OF THE ACT ON VARIOUS FLATS. 25.HOWEVER, THE LD. CIT(A) SUSTAINED THE ACTION OF THE AO IN INCLUDING SUNKEN AREA (FLOWER BED) AND 50% OF COMMON WALL AREA FOR THE PU RPOSE OF COMPUTING ELIGIBLE AREA OF 1000 SQ. FT OF BUILT UP AREA FOR THE PURPOS E OF COMPUTING DEDUCTION U/S 80IB(10) OF THE ACT. 25.THE ASSESSEE BEFORE US FILED DETAILED WRITTEN SU BMISSIONS AND ARGUED EXTENSIVELY AND SUBMITTED THAT THE FLOWER BED AREA SHOULD NOT BE INCLUDED IN THE DEFINITION OF BUILT UP AREA AS THE FLOWER BED AREA IS BELOW THE F LOOR LEVEL OPEN TO SKY AND OUTSIDE THE SCOPE OF DEFINITION OF BUILT UP AREA. IT WAS SU BMITTED THAT THE FLOWER BED AREA IS 21 OPEN TO SKY AND AREA OPEN TO SKY INCLUDING TERRACE SHALL NOT BE INCLUDED IN THE BUILT UP AREA. THE LD. COUNSEL ALSO CONTENDED THAT WHEN THE SURVEY WAS CARRIED OUT ON 2.2.2012 THE ALLOWABILITY FOR CLAIMING DEDUCTION U/S 80IB(10) WAS DULY VERIFIED BY THE SURVEY PARTY. THEY HAVE VISITED PROJECT SITE . THEY HAVE CONDUCTED EXERCISE DURING THE COURSE OF SURVEY WITH REGARD TO MEASUREM ENT OF FLATS BY THE CPWD, DEPARTMENTAL VALUATION OFFICERS. THEY HAVE SATISFIE D WITH THE CONSTRUCTION AREA OF EACH FLAT I.E. BUILT UP AREA OF EACH FLAT IS WITHIN ELIGIBLE LIMIT OF 1000 SQ. FT. THEREFORE, IT WAS CONTENDED THAT THE REPORT OF THE DISTRICT VALUATION OFFICER OF THE DEPARTMENT CANNOT BE BRUSHED ASIDE AND THE AO CANNO T RELY ON THE SUBSEQUENT DVOS REPORT WHICH WAS NOT BASED ON THE ANY SCIENTI FIC MEASUREMENT BUT WAS TAKEN ON ROUGH SKETCH TAKEN BY THE DVO. IT WAS CONTENTED THAT WIDE VARIATION BETWEEN THE TWO VALUATION REPORTS IS PRACTICALLY NOT POSSIBLE A ND THEREFORE THE SUBSEQUENT VALUATION REPORT PREPARED BY THE DVO WITHOUT PROPER MEASUREMENT CANNOT BE THE BASIS FOR DENYING THE BENEFIT U/S 80IB(10) OF THE A CT. DURING THE COURSE OF HEARING BEFORE US, THE ASSESSEE FILED DETAILED SUBMISSIONS AS UNDER: .. ... (TRUNCATED) 26.WE FIND CONSIDERABLE FORCE IN THE SUBMISSIONS OF THE ASSESSEE THAT THE FLOWER BED AREA AND COMMON WALL AREA ARE NOT INCLUDIBLE IN THE DEFINITION OF BUILT UP AREA WHILE CALCULATING THE ELIGIBLE LIMIT OF 1000 SQ. FT FOR T HE PURPOSE OF ALLOWING DEDUCTION U/S 80IB(10) OF THE ACT. THE FLOWER BED AREA IS OPEN TO SKY AND NOT COVERED BY ANY SIDES WHEREAS BALCONY IS COVERED WITH THREE SIDES. THE FLOWER BED AREA IS FEW INCHES BELOW FLOOR LEVEL. IT IS THE SUBMISSION OF THE ASSE SSEE THAT THE FLOWER BED AREA IS OUTSIDE THE BALCONY AREA AND THE STARTING POINT FOR THE FLOWER BED AREA IS A POINT WHERE THE BALCONY AREA ENDS. 27.IN THE CASE OF ITO V/S PODDAR ASHISH DEVELOPERS IN ITA NO.3408/M/2010 DATED 12-032014, THE CO-ORDINATE BENCH OF THE TRIBUNAL H AS CONSIDERED THE SITUATION AS TO WHETHER THE AREAS OF A UNIT WHICH IS NOT ON FLOO R LEVEL WHETHER SHOULD BE INCLUDIBLE IN THE DEFINITION OF BUILT AREA OR NOT A ND THE CO-ORDINATE BENCH HELD: 10.9 BY A COMBINED READING OF THE PROVISIONS OF T HE IT ACT AND THE DEVELOPMENT CONTROL REGULATIONS, IT TRANSPIRES THAT THE AREA OF A UNIT THE FLOOR LEVEL USED IN THE IT ACT AND THE EXCEPTION OF AREA WITH THE LEVEL DIFFERENCE OF 0.3 MTS UNDER THE DCR HAVE A GREATER SIGNIFICANCE. THEY HAVE NOT BEEN USED IN THE RELEVA NT PROVISIONS WITHOUT ANY MEANING OR REASON. THE AREAS STIPULATED UNDER THE DCR TO BE WI TH THE LEVEL DIFFERENCE TO THE FLOOR LEVER ARE CHAJJAS, FLOWER BEDS, DRY BALCONY ETC WHICH ARE TO BE PROVIDED FOR PROPER VENTILATIONS, LIGHT AND PROTECTION FROM WEATHER TO THE ACTUAL USE ABLE FLAT AREA OF THE FLAT. THEY ARE NOT ON THE SAME FLOOR LEVEL AS THE USEABLE AREA FOR THE OC CUPANT AND THEREFORE UNDER THE DEFINITION OF BUILT UP AREA, THESE AREAS ARE NOT INCLUDABLE. IN THE CASE OF COMMONWEALTH DEVELOPERS V/S ACIT (20 14) 44 TAXMANN.COM 303, THE HONBLE JURISDICTIONAL HIGH COURT HELD THAT AR EA OF COURTYARD WHICH IS OPEN TO SKY AND APPURTENANT TO RESIDENTIAL UNIT IS NOT TO B E INCLUDED TO COMPUTE BUILT-UP AREA IN TERMS OF SECTION 80-IB(10) 28. THEREFORE AS COULD BE SEEN FROM THE ABOVE, THE CO-ORDINATE BENCH HELD THAT CHAJJAS, FLOOR BED, DRY BALCONY ETC WHICH ARE BELOW FLOOR LEVEL SHALL NOT BE INCLUDED IN THE DEFINITION OF BUILT UP AREA. 29.IT WAS FURTHER CONTENDED BEFORE US THAT THE FLOW ER BED AREA IS ORNAMENTAL AND 22 ELEVATIVE FEATURE PROVIDED ON THE OUTER SIDE OF THE RESIDENTIAL UNIT, THESE ARE NOT HABITABLE AREA, PROVIDED MAINLY FOR THE ELEVATION O R DESIGNING PART OF THE BUILDING, SUCH AREA ARE NOT COVERED BY WALL OF EITHER SIDES A ND HENCE DID NOT CONSTITUTE THE INNER PART OF THE RESIDENTIAL UNIT WHICH MAKES IT A NON HABITABLE AREA. THEREFORE, IT WAS CONTENTED THAT SINCE THE FLOWER BED AREA ARE OP EN TO SKY AND NOT COVERED BY THE WALL IT CANNOT BE COUNTED IN BUILT UP AREA. FOR THE PROPOSITION THAT AN AREA OPEN TO SKY CANNOT BE INCLUDED IN BUILT UP AREA, THE ASSESS EE RELIED UPON THE FOLLOWING CASES: I) NARESH WADHWANI ITA NO.18/PN/2013; II) CEEBROS HOTEL (P) LTD V/S DCIT TC NO.581,1186 OF 2 008 AND 136 OF 2009 JUDGMENT DATED 19.10.2012 (MADRAS HIGH COURT); III) CIT V/S MAHALAKSHMI HOUSING (2014) 41 TAXMANN.COM 1 46 (MADRAS HIGH COURT); IV) CIT V/S SANGHVI AND DOSHI ENTERPRISE TAX CASE (APPE AL) NOS. 581 AND 582 OF 2011 AND 314 AND 315 OF 2012 MP NO.1 OF 2011(MADRAS HIGH COU RT) V) AMALTAX ASSOCIATES V/S ITO (2011) 11 TAXMANN.COM 420 (AHD); VI) COMMONWEALTH DEVELOPERS V/S ACIT (2014) 44 TAXMANN. COM 303 (BOM) 30.AFTER CONSIDERING THE RIVAL SUBMISSIONS AND MATE RIALS PLACED BEFORE US INCLUDING THE DECISIONS OF THE RIVAL PARTIES WE FIND THAT THE FLOWER BEDS WHICH ARE BELOW THE FLOOR LEVEL CANNOT FORM PART OF CONSTRUCTED AREA OF FLAT FOR THE PURPOSE OF DETERMINING THE ELIGIBILITY OF THE ASSESSEE TO DEDU CTION U/S 80(IB)(10) OF THE ACT. 31.COMING TO THE REVENUES APPEALS, THE DEPARTMENT HAS CHALLENGED THE ORDERS OF THE LD.CIT(A) IN DIRECTING THE AO TO EXCLUDE THE SE RVICE AREA, WINDOW AREA, WINDOW PROJECTION, CUPBOARD PROJECTION FROM THE DEFINITION OF BUILT UP AREA FOR CALCULATING THE DEDUCTION U/S 80IB(10) OF THE ACT AND THE ELIGI BLE AREA OF 1000 SQ. FT. THE LD. CIT(A) EXCLUDED THE SAID SERVICES AREA, CUPBOARD PR OJECTION AND WINDOW PROJECTION BY OBSERVING AS UNDER: C. CUPBOARD PROJECTIONS : THE NEXT OBJECTION IS ABOUT INCLUSION OF CUPBOARD A REA. IT IS GATHERED THAT CUPBOARDS ARE NORMALLY CARVED OUT OF WALL AREA ONLY. IN SOME CASE S, CUPBOARDS MAY BE PROJECTED A FEW INCHES OUTSIDE THE WALLS. CONSIDERING THE FACTS OF THE CASE, I AM OF THE VIEW THAT AS CUPBOARD AREA IS ALREADY INCLUDED IN THE WALL AREA ITSELF, SO SEPARATE ADDITION ON THIS ACCOUNT MAY NOT BE WARRANTED IN BUILT-UP AREA. IN SOME CASE S, WHEN IT IS PROJECTED IN OTHER ROOM, IT WOULD HAVE ALREADY INCLUDED IN THE AREA OF OTHER RO OM. THEREFORE, SEPARATE ADDITION IN THIS REGARD MAY NOT BE WARRANTED. I, THEREFORE, HOLD THA T CUPBOARD AREA. IS NOT LIABLE TO BE ADDED SEPARATELY IN THE BUILT-UP AREA AND WALL AREA WILL TAKE CARE OF IT. D)SERVICE AREA: NEXT ISSUE IS RELATING TO INCLUSION OF SERVICE AREA S. THE SERVICE AREA IS IN THE NATURE OF SERVICE PIPE DUCT, WHICH CONTINUES FR OM TOP FLOOR TO GROUND FLOOR AND CARRIES SERVICE PIPES, NAMELY SOIL PIPE, WASTE WATER PIPE, WATER MAINS, ETC. DURING THE COURSE OF PHYSICAL INSPECTION OF VARIOUS APARTMENTS ON 5/6/20 14, IT WAS NOTICED THAT THIS AREA IS QUITE SMALL AND CARRIES AS MANY AS 12 - 14 PIPES - ABOUT 4 PIPES HAVING 4' DIAMETER, ABOUT 3 PIPES HAVING 2' DIAMETER, AND SOME PIPES HAVING ABO UT ONE INCH DIAMETER. NO DOUBT, A SLAB HAS BEEN CONSTRUCTED AT EVERY FLOOR AND A DOOR IS P ROVIDED IN THE BATHROOM TO ENTER INTO THE SERVICE AREA, BUT THIS AREA IS PRIMARILY MEANT FOR REPAIR OF SERVICE PIPES AND IT CANNOT BE USED FOR ANY OTHER PURPOSES. FURTHER, THIS SERVICE DUCT IS SOME KIND OF COMMON AREA LIKE STAIR CASE, FLOWING FROM TOP TO BOTTOM, AND IN CASE OF ANY BLOCKAGE OF PIPES OR REPAIR OR LEAKAGE, ETC, THE MECHANIC HAS TO ENTER THIS AREA F OR REPAIRING THE SAME. GENERALLY SPEAKING, THIS AREA, BEING SMALL, CANNOT BE USED FOR ANY OTHE R PURPOSES. THIS AREA HAS ALSO NOT BEEN SOLD BY THE ASSESSEE TO THE FLAT OWNERS, AS IS EVID ENT FROM SALE AGREEMENTS. FURTHER, IT IS ALSO NOT PART OF THE CARPET AREA OR BUA CALCULATED BY THE BMC AUTHORITIES. THIS IS NOT ALSO CONSIDERED FOR FSI COMPUTATION OF THE BUILDING, AS PER BYE LAWS. IN FACT, ON PHYSICAL INSPECTION, IT WAS NOTICED THAT SOME OF THESE PIPES WERE LEAKIN G, GIVING A FOUL SMELL, AND, THEREFORE, I AM OF THE VIEW THAT IT CANNOT BE USED FOR ANY OTHER PURPOSES. THE PHOTOGRAPHS SUBMITTED BY THE ASSESSEE CLEARLY SHOW THAT THESE DUCTS ARE OPEN AND DANGEROUS, AND A CHILD MAY IN 23 FACT FALL THROUGH IT. THESE PHOTOS WERE FORWARDED T O THE AO FOR HER COMMENTS. ALSO, FOR THE SAKE OF CLARITY, THE SAME ARE ENCLOSED AS ANNEXURE TO THIS ORDER. THOUGH THE AO HAS ENCLOSED SOME PHOTOS OF SUCH AREAS IN RESPECT OF SO ME FLATS, WHERE SUCH AREAS ARE BEING USED TOWARDS STORAGE, ETC. BY A FEW FLAT OWNERS, BU T IT IS ON THEIR OWN PERIL AND BUILDER CANNOT BE BLAMED FOR IT. AS PER THE BYE LAWS, THIS AREA CANNOT BE USED FOR ANY PURPOSE AND FLAT OWNERS ARE PROHIBITED FROM DOING SO. BUT STILL , IF SOME PEOPLE, BECAUSE OF ANY REASONS, ARE USING THE SAME FOR STORAGE OR PUTTING A WASHING MACHINE OR A LPG CYLINDER, THEY ARE DOING IT ON THEIR OWN ACCORD. MOREOVER, THERE IS NO EVIDENCE TO SUGGEST THAT THE ASSESSEE HAS SOLD THESE AREAS TO RESPECTIVE BUYERS, OR OTHERWISE , BUYERS OWN SUCH AREAS. THEREFORE, THE OBSERVATION OF THE AO THAT SUCH AREA WAS UNDER EXCL USIVE POSSESSION OF FLAT OWNERS, REMAINS UNSUBSTANTIATED, AS IN MY OPINION, THE FLAT OWNERS MAY BE USING THE AREA, BUT LARGELY THE AREA IS MEANT FOR COMMON FACILITIES FOR ALL THE FLATS AND ACTS AS DUCT FOR VARIOUS KINDS OF FACILITIES FOR ALL THE FLOORS. IN ANY CASE , IT DOES NOT ALTER THE MATERIAL POSITION. CONSIDERING THE OVERALL FACTS OF THE CASE, I AM OF THE OPINION THAT THIS AREA. SHOULD NOT FORM PART OF THE BUA, AS IT IS IN THE NATURE OF COMMON A REA MEANT FOR ALL THE FLAT OWNERS FROM TOP FLOOR TO GROUND FLOOR, AND PURPOSE OF THIS AREA IS TO PROVIDE A PLATFORM FOR REPAIR, AND REPLACEMENT OF THE SERVICE PIPES, INCLUDING SOIL PI PE, WASTE WATER PIPES, WATER MAINS, ETC. SIMILAR OPINION' HAS BEEN GIVEN BY THE OTHER EXPERT S. ACCORDINGLY, CONSIDERING OVERALL FACTS OF THE CASE, I DIRECT THE AO TO EXCLUDE THIS AREA F ROM THE BUA. E)WINDOW PROJECTIONS : IT IS GATHERED THAT THE VALUATION OFFICER, IN RESPE CT OF SOME OF THE FLATS, HAS ADDED CERTAIN AREA IN THE NATURE OF WINDOW PROJECTIONS. DURING THE COURSE OF PHYSICAL INSPECTION, IT WAS NOTICED THAT THESE WINDOW PROJECTIONS ARE AREAS IN THE NATURE OF ORNAMENTAL PROJECTIONS DONE WITH A VIEW TO BEAUTIFY THE BUILDING. THESE AREAS ARE SITUATED AT WINDOW-SILL LEVEL, ABOUT THREE FEET ABOVE THE FLOOR LEVEL, AND SOME KIND OF PROJECTIONS / EXTENSI ON OF THE BUILDING. IN MY OPINION, THESE PROJECTIONS CANNOT BE USED FOR ANY PURPOSES, BECAUS E THE AREA IS HIGHLY UNSAFE AND ANYBODY CAN FALL FROM SUCH AREA. HOWEVER, IT WAS NO TICED THAT SOME PEOPLE ARE USING THE AREA TO PUT AIR CONDITIONER, FLOWER POTS, ETC. CONS IDERING THE FACTS OF THE CASE, I AM OF THE VIEW THAT THIS IS ESSENTIALLY AN ELEVATIONAL FEATUR E AND HAS NOTHING TO DO WITH CARPET AREA OF THE FLAT. THEREFORE, IT CANNOT FORM PART OF BUA. IT IS LIKE A SILL OF A WINDOW, WHICH IS SLIGHTLY EXTENDED AND IN SOME CASES MAY BE USED FOR PROTECTI ON FROM SUNLIGHT AND RAIN. IT IS ALSO NOT THE CASE THAT THE BUILDER HAS SOLD THIS AREA TO VAR IOUS FLAT OWNERS. ACCORDINGLY, THIS AREA IS ALSO DIRECTED TO BE EXCLUDED. WHILE CALCULATING BUA . I WOULD LIKE TO FURTHER CLARIFY THAT THIS AREA IS VERY SMALL AND STILL HAVE VERY INSIGNIFICAN T BEARING UPON OVERALL BUA. 32. ONGOING THROUGH THE ABOVE FINDINGS OF THE LD. C IT(A), WE DO NOT FIND ANY VALID REASON TO INCLUDE SERVICE AREA, WINDOW AREA, WINDOW PROJECTIONS AND CUPBOARD PROJECTION IN THE BUILT UP AREA FOR CALCULATING ELI GIBLE BUILT UP AREA OF 1000 SQ.FT FOR THE PURPOSE OF COMPUTATION OF DEDUCTION U/S 80IB(10 ) OF THE ACT. . . 39. IN VIEW OF THE ABOVE DISCUSSION AND OBSERVATION S, WE ARE OF THE CONSIDERED VIEW THAT EVEN ON MERITS THE ASSESSEE SUCCEEDS. IN ANY CASE, WE HOLD THAT THE ASSESSMENTS IN THESE CASES ARE BAD IN LAW FOR THE REASON THAT THE ASSESS MENTS WERE MADE ON NON-EXISTING ENTITY. IN THE CIRCUMSTANCES, WE QUASH THE ASSESSME NT ORDERS PASSED UNDER SECTION 143(3) R.W.S.153A OF THE ACT FOR THE ASSESSMENT YEARS 2010 -11 TO 2012-13. 40. IN THE RESULTS, ALL THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED AND THAT OF REVENUE STAND DISMISSED. THE PERUSAL OF PARA-14 OF THE ABOVE DECISION REVEAL THAT THE CO-ORDINATE BENCH HAS OBSERVED THAT SEARCH ACTION WAS A STRICT ACTION TAKEN AGAINST THE PRIVACY OF ANY PERSON AND THEREFORE THE AFORESA ID POWERS BESTOWED 24 UPON THE AUTHORITIES WERE TO BE EXERCISED WITH UTMO ST PRECAUTION AND ONLY AFTER CONDUCTING DETAILED ENQUIRIES & INVESTIG ATION. THEREFORE, NON- MENTIONING OF CORRECT NAME OF THE ENTITIES COULD NO T BE TERMED AS MERE CLERICAL OR PROCEDURAL MISTAKE PARTICULARLY WHEN TH E ASSESSEE HAD ALREADY INTIMATED THE FACT OF DISSOLUTION OF THE FI RM TO THE DEPARTMENT MUCH BEFORE THE DATE OF THE SEARCH. THEREFORE, THE ISSUE OF PANCHNAMA IN THE NAME OF DISSOLVED FIRM COULD NOT BE SAID TO BE VALID. WHEN THE SEARCH U/S 132 WAS CONDUCTED AND TO BE VALID, THE W ARRANT AND NOTICE SHOULD BE ISSUED IN THE NAME OF THE SUCCESSOR ONLY WHEREAS THESE, IN THE PRESENT CASE, HAD BEEN ISSUED IN THE NAME OF NAHAR ENTERPRISES, A NON-EXISTENT ENTITY WHICH COULD NOT BE SAID TO BE M ERE CLERICAL MISTAKE. WHILE ARRIVING AT SUCH CONCLUSIONS, RATIO WAS DRAWN FROM THE FOLLOWING DECISIONS OF HIGHER JUDICIAL AUTHORITIES: - NO. TITLE RENDERED BY CITATION 1. SPICE INFOTAINMENT LTD. VS. CIT HONBLE DELHI HI GH COURT 247 CTR 500 2. CIT VS INTEL TECHNOLOGY INDIA (P) LTD. HONBLE K ARNATAKA HIGH COURT 380 ITR 272 3. CIT VS MICRON STEELS PVT. LTD. HONBLE DELHI HIG H COURT 372 ITR 386 4. CIT VS MICRA INDIA P.LTD. HONBLE DELHI HIGH COU RT 232 TAXMAN 809 SIMILAR FACTS EXIST IN THE GIVEN YEAR. NO CONTRARY JUDGMENT HAS BEEN PLACED ON RECORD BY THE REVENUE. THEREFORE, MATERIA L FACTS AND CIRCUMSTANCE BEING THE SAME, RESPECTFULLY FOLLOWING THE VIEW OF THE CO- ORDINATE BENCH OF THE TRIBUNAL, WE HOLD THAT THE AS SESSMENT PROCEEDINGS WERE BAD IN LAW AND THEREFORE, COULD NOT BE SUSTAIN ED IN THE EYES OF LAW. WE ORDER SO. THE ISSUE ON MERITS HAS ALSO BEEN DECI DED IN ASSESSEES FAVOR BY HOLDING THAT SERVICE AREA, WINDOW AREA, WINDOW PROJECTIONS AND CUPBOARD PROJECTIONS WERE NOT TO BE INCLUDED WHILE COMPUTING THE BUILT- UP AREA. ACCORDINGLY, GROUND NUMBERS-1, 3 & 4 OF AS SESSEES APPEAL SUCCEEDS WHEREAS GROUND NUMBER-2 STAND ADJUDICATED AGAINST THE 25 ASSESSEE. RESULTANTLY, THE REVENUES APPEAL STANDS DISMISSED. THE ASSESSEES APPEAL STANDS PARTLY ALLOWED. CROSS APPEALS FOR AY 2009-10 6. FOR THIS AY, THE ASSESSEE HAS SIMILARLY BEEN ASS ESSED U/S 143(3) READ WITH SECTION 153A ON 14/03/2014 AND HAS BEEN DENIED DEDUCTION U/S 80IB(10) AMOUNTING TO RS.36.63 CRORES. THE FIRS T APPELLATE AUTHORITY HAS GRANTED PART RELIEF TO THE ASSESSEE ON SIMILAR LINES AGAINST WHICH THE CROSS APPEALS HAVE BEEN FILED BEFORE US WITH SIMILA R GROUNDS OF APPEAL. FACTS AND CIRCUMSTANCES, BEING PARI-MATERIA, THE SAME, TAKING THE SAME VIEW, THE REVENUES APPEAL STAND DISMISSED WHEREAS THE ASSESSEES APPEAL STANDS PARTLY ALLOWED. CONCLUSION 7. THE APPEALS OF THE REVENUE STANDS DISMISSED WHER EAS THE APPEALS OF THE ASSESSEE STANDS PARTLY ALLOWED IN TERMS OF O UR ABOVE ORDER. ORDER PRONOUNCED IN THE OPEN COURT ON 02 ND JANUARY, 2019. SD/- SD/- (MAHAVIR SINGH) (MAN OJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 02/01/2019 SR.PS, JAISY VARGHESE ! / COPY OF THE ORDER FORWARDED TO : 1. ! / THE APPELLANT 2. '#! / THE RESPONDENT 3. * ( ) / THE CIT(A) 4. * / CIT CONCERNED 5. +, '%- , - , / DR, ITAT, MUMBAI 6. ,./0 / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.