Facts of the Case

  • The petitioner, GE India Industrial Pvt. Ltd., was the successor entity following amalgamation of:
    • GE India Technology Centre Pvt. Ltd.
    • GE India Exports Pvt. Ltd.
  • The Income Tax Department issued reassessment notices dated 30.06.2021 under Section 148.
  • These notices were addressed to the erstwhile companies, which had already merged and ceased to exist.
  • The petitioner challenged the validity of such notices before the Delhi High Court.

Issues Involved

  1. Whether reassessment notices issued under Section 148 to non-existent entities are legally valid.
  2. Whether such defect can be treated as a procedural irregularity or renders the notice void ab initio.
  3. Whether the Revenue can issue fresh notices after such invalidation.

Petitioner’s Arguments

  • The notices were fundamentally invalid as they were issued to entities that no longer existed due to amalgamation.
  • Jurisdictional defect: issuance of notice to a non-existent entity cannot be cured.
  • The reassessment proceedings based on such notices are void ab initio.
  • Relied on settled legal principle that proceedings against non-existent entities are unsustainable in law.

Respondent’s Arguments

  • The Revenue admitted that notices were issued to non-existent entities.
  • It was contended that:
    • The error was inadvertent.
    • The Department should be permitted to issue fresh notices under Section 148.
    • Such notices could relate back to the relevant assessment period prior to 30.06.2021.

Court’s Findings / Order

  • The Court held that:
    • Notices issued to non-existent entities are unsustainable in law.
    • Since the entities had already merged, the notices lacked legal validity.
  • Accordingly:
    • The impugned notices dated 30.06.2021 were set aside.
    • The writ petitions were disposed of.
  • The Court granted:
    • Liberty to the Revenue to take fresh steps in accordance with law.
    • Liberty to the petitioner to challenge any such future action.

Important Clarification

  • The defect is not procedural but jurisdictional.
  • Issuing notice to a non-existent entity invalidates the entire reassessment proceeding.
  • However, the Court allowed the Revenue to proceed afresh, subject to legal compliance.


Link to download the order -https://delhihighcourt.nic.in/app/case_number_pdf/2021:DHC:3717-DB/TWS17112021CW76442021_114433.pdf

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