Unique Mercantile India Limited V. Union of India

SCA/2019/2022

AI Insights

In this case, Unique Mercantile India Limited, the petitioner, challenged the validity of notices issued under Section 148 of the Income Tax Act, 1961, for the assessment year 2017-18. The notices were issued in the name of Unique Mercantile India Pvt. Ltd., which had already been amalgamated into another entity and ceased to exist. The petitioner argued that the notices were ultra vires the Income Tax Act and the Finance Act, 2021, as they were directed to a non-existent company. The court found that the respondent authorities had not properly updated their records to reflect the amalgamation, leading to the issuance of notices to a non-existent entity.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 802044 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 28-03-2022
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961, Finance Act, 2021, Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: M R BHATT; KARAN SANGHANI
• Assessee Lawyers: HIREN TRIVEDI
• Keywords: Amalgamation; Non-existent company; Reassessment proceedings; Ultra Vires; Writ of Mandamus
• Section: 148; 142(1); 226

Judgement Text

"C/SCA/2019/2022 JUDGMENT DATED: 28/03/2022 IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 2019 of 2022 FOR APPROVAL AND SIGNATURE: HONOURABLE MR. JUSTICE J.B.PARDIWALA and HONOURABLE MS. JUSTICE NISHA M. THAKORE ========================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ? ========================================================== UNIQUE MERCANTILE INDIA LIMITED Versus UNION OF INDIA ========================================================== Appearance: HIREN J TRIVEDI(8808) for the Petitioner(s) No. 1 MR MR BHATT WITH KARAN SANGHANI FOR M R BHATT & CO.(5953) for the Respondent(s) No. 2,3 NOTICE NOT RECD BACK for the Respondent(s) No. 1 ========================================================== CORAM:HONOURABLE MR. JUSTICE J.B.PARDIWALA and HONOURABLE MS. JUSTICE NISHA M. THAKORE Date : 28/03/2022 ORAL JUDGMENT (PER : HONOURABLE MS. JUSTICE NISHA M. THAKORE) 1. By this writ application under Article 226 of the Constitution of India, the writ applicant has prayed for the following reliefs: “(A) YOUR LORDSHIPS may be pleased to issue a writ of mandamus or a writ in the nature of mandamus or any Page 1 of 3 C/SCA/2019/2022 JUDGMENT DATED: 28/03/2022 other appropriate writ holding and declaring that the Notification No.20/2021 dated 31.03.2021 and Notification No.38/2021 dated 27.04.2021 are ultra vires the Income Tax Act, 1961 and the Finance Act, 2021; (B) YOUR LORDSHIPS may be pleased to issue a writ of mandamus or a writ in the nature of mandamus or any other appropriate writ, order or directions to quash and set aside the impugned notice issued under section 148 of the Act dated 30.06.2021 (at Annexure C); (C) During the pendency and final disposal of the present petition, YOUR LORDSHIPS may be pleased to be stay the reassessment proceedings pursuant to notice under Section 148 dated 30.06.2021 (at Annexure C) and further be pleased to direct the respondent – authorities to restrain from acting in furtherance thereof; (D) Pass any such other and / or further order that may be though just and proper, in the facts and circumstances of the present case;” 2. We have heard Mr. Hiren Trivedi, the learned counsel appearing for the writ applicant and Mr. M.R. Bhatt, the learned senior counsel assisted by Mr. Karan Sanghani for the respondent Authorities. 3. The writ applicant is a Company incorporated under the provisions of the Companies Act and is engaged in the business of facility cards, providing stay plans and corporate agents of insurance companies. It appears from the record that the assessment proceedings for the A.Y. 2017-18 were initiated in the name of writ applicant Unique Mercantile India Pvt. Limited (in short “the transferor Company/amalgamating Company”). The record further reveals that the notice under Section 142(1) of the Act came to be issued in the name of the said transferor Company. On receipt of the same, the transferor Company vide letter dated Page 2 of 3 C/SCA/2019/2022 JUDGMENT DATED: 28/03/2022 19.01.2018 informed the respondent Authorities that the transferor Company has already been amalgamated with the transferee Company and the said transferor Company ceased to exist and in fact, the PAN No. was also no longer in effect. Inspite of the aforesaid fact being brought to the notice of the respondent Authorities, the writ applicant Company received notice under Section 148 of the Act dated 30.06.2021, which was referred to in the name of the transferor Company and non-existent PAN of the transferor Company was referred. 4. The writ applicant has placed on record the approved scheme of amalgamation. The aforesaid fact has not been controverted by the respondents. Thus, with effect from 1.4.2016, the writ applicant Company stands amalgamated with M/s. Unique Hyderabad Hotel Project Pvt. Ltd. (which is now known as Unique Mercantile India Pvt. Ltd.) bearing PANo.AADCP84358. 5. In light of the aforesaid, the impugned notice as emerges from the record has been issued upon the non-existing Company and on this sole ground, the present writ application succeeds. The impugned notice is hereby quashed and set aside. With the aforesaid, present petition stands disposed of accordingly. (J. B. PARDIWALA, J) (NISHA M. THAKORE,J) Y.N. VYAS Page 3 of 3 "