Gujarat High Court
Vital Connections Llp vs The National Faceless Assessment ... on 7 April, 2025
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
NEUTRAL CITATION
C/SCA/7617/2022 JUDGMENT DATED: 07/04/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 7617 of 2022
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR.JUSTICE D.N.RAY
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Approved for Reporting Yes No
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VITAL CONNECTIONS LLP
Versus
THE NATIONAL FACELESS ASSESSMENT CENTRE & ORS.
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Appearance:
MR. TUSHAR HEMANI, SR. ADVOCATE WITH MS VAIBHAVI K PARIKH
WITH MS. RESHAM THAKKAR (3238) for the Petitioner(s) No. 1
MR.VARUN K.PATEL(3802) for the Respondent(s) No. 1,2,3
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CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR.JUSTICE D.N.RAY
Date : 07/04/2025
ORAL JUDGMENT
(PER : HONOURABLE MR.JUSTICE D.N.RAY)
1. Heard learned Senior Advocate Mr.Tushar Hemani with learned advocate Ms. Vaibhavi K. Parikh with learned advocate Ms. Resham Thakkar appearing on behalf of the Petitioner and learned Senior Standing Counsel Mr. Varun K. Patel for the Respondents. Page 1 of 7 Uploaded by BINA SHAH(HC00353) on Tue Apr 22 2025 Downloaded on : Sat Apr 26 05:02:23 IST 2025
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2. Rule returnable forthwith. Learned Senior Standing Counsel Mr.Varun Patel waives service of the notice of the rule on behalf of the Respondents. With the consent of the learned advocates for the respective parties, the matter is taken up for hearing, as the issue involved is very short.
3. The brief facts of the case are as follows:
3.1 The Petitioner is a Limited Liability Partnership (LLP). One Kauvery Trexim Private Limited (the Assessee) stood amalgamated with Vital Connections Private Limited pursuant to an order dated 15.12.2017 passed by the learned National Company Law Tribunal (NCLT). Subsequently, Vital Connections Private Limited was converted into a Limited Liability Partnership under the name Vital Connections LLP (the petitioner) with effect from 13.03.2018.
3.2 The Respondent issued a notice dated 31.03.2021 under Section 148 of the Income-tax Act, 1961 ("the Act") in the name of the Assessee. In response, the Petitioner submitted objections to the initiation of the reassessment proceedings vide communication dated Page 2 of 7 Uploaded by BINA SHAH(HC00353) on Tue Apr 22 2025 Downloaded on : Sat Apr 26 05:02:23 IST 2025 NEUTRAL CITATION C/SCA/7617/2022 JUDGMENT DATED: 07/04/2025 undefined 22.07.2021, specifically bringing to the Respondent's attention the factum of merger of the Assessee with the Petitioner. It was contended that the reassessment proceedings were void ab initio, as the notice was issued in the name of a non-existent entity, and accordingly, the Petitioner requested for the proceedings be dropped. 3.3 Thereafter, vide notice dated 14.03.2022 issued under Section 142(1) of the Act, the Respondent called upon the Petitioner to furnish certain information and documents. In reply, the Petitioner reiterated its request for disposal of the objections earlier raised vide letter dated 22.07.2021.
3.4 On 28.03.2022, the Respondent issued a show cause notice along with a draft assessment order, calling upon the Petitioner to show cause as to why the proposed variations ought not to be made and why the assessment should not be completed in terms thereof. The Petitioner was directed to submit its response by 29.03.2022. 3.5 The Petitioner, vide letter dated 29.03.2022, submitted a Page 3 of 7 Uploaded by BINA SHAH(HC00353) on Tue Apr 22 2025 Downloaded on : Sat Apr 26 05:02:23 IST 2025 NEUTRAL CITATION C/SCA/7617/2022 JUDGMENT DATED: 07/04/2025 undefined partial response wherein it again requested the Respondent to dispose of the objections raised against the reopening of assessment. On the same date, i.e., 29.03.2022, the Petitioner also submitted detailed written submissions on the merits of the case and further requested for a hearing through video conferencing. 3.6 However, without disposing of the objections or granting a hearing, the Respondent proceeded to pass the assessment order dated 30.03.2022 under Section 147 read with Section 144B of the Act, determining the total income of the Petitioner at ₹16,14,60,400/-. Consequently, a substantial demand of16,14,60,400/-. Consequently, a substantial demand of ₹16,14,60,400/-. Consequently, a substantial demand of8,28,41,280/- was raised against the Petitioner for the Assessment Year 2015-16.
3.7 Aggrieved by the impugned Assessment Order and the demand notice dated 30.03.2022, the Petitioner has filed the present Writ Petition under Article 226 of the Constitution of India, seeking the following reliefs:
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NEUTRAL CITATION C/SCA/7617/2022 JUDGMENT DATED: 07/04/2025 undefined "(a) quash and set aside the impugned Assessment Order dated 30.03.22 as well as the demand notice dated 30.03.22 for the Assessment Year 2015-16 at ANNEXURE "A (Colly.)" to this petition;
(b) pending the admission, hearing and final disposal of this petition, to stay the implementation and operation of the impugned Assessment Order dated 30.03.22 as well as the demand notice dated 30.03.22 for the Assessment Year 2015-16 at ANNEXURE "A (Colly.)" to this petition;
(c) any other and further relief deemed just and proper be granted in the interest of justice:
(d) to provide for the cost of this petition."
4. Learned Senior Advocate Mr. Tushar Hemani instructed by Ms. Vaibhavi K. Parikh, learned advocate and Ms. Resham Thakker, learned advocate appearing for the petitioner have respectively made submissions at different points of time. Mr.Hemani, learned Senior Advocate submitted that the factum of merger of the Assessee with the Petitioner was categorically brought to the notice of the Respondent-Authorities. Therefore, the reopening notice was issued in the name of non-existent entity. Consequently, the assessment proceedings were needed to be dropped.
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5. Per contra, learned Senior Standing Counsel Mr. Varun Patel appearing on behalf of the Respondent-Department by placing reliance on the affidavit-in-reply filed by the Respondent No.2 submitted that there is nothing on record to show that the Petitioner had intimated the merger approval order of the learned NCLT, Ahmedabad to the concerned Jurisdictional Assessing Officer, prior to the issuance of notice under Section 148 of the Act. Accordingly, Mr. Patel submitted that the present petition deserves to be rejected on such ground alone.
6. From the perusal of the records, it will be seen that in response to the notice cum draft Assessment Order dated 28.03.2022 under Section 147 read with Section 144B of the Act, addressed to the Assessee in question namely Kauvery Trexim Pvt. Ltd., the Petitioner had responded on 29.03.2022 (uploaded on the same day), stating the factum of amalgamation and specifically uploading the certified copy of the Scheme of Amalgamation Order passed by the NCLT and other annexures. Additionally, on 29.03.2022, further detailed submissions on facts and law including a detailed Page 6 of 7 Uploaded by BINA SHAH(HC00353) on Tue Apr 22 2025 Downloaded on : Sat Apr 26 05:02:23 IST 2025 NEUTRAL CITATION C/SCA/7617/2022 JUDGMENT DATED: 07/04/2025 undefined reply on merits was uploaded along with copies of several decisions of the Hon'ble Supreme Court, etc. The Petitioner also sought a video conference reserving its right to make further submissions. Therefore, in such circumstances the Respondent could not have assumed the jurisdiction to issue a notice in the name of a non- existent entity. Following the ratio laid down in the case of PCIT Vs. Maruti Suzuki India Ltd., reported (2019) 416 ITR 613 (SC), the Assessment Order dated 30.03.2022 and the consequent notice of demand under Section 156 of the Income Tax Act, 1961 deserves to be and are hereby quashed and set aside.
7. Accordingly, the impugned Assessment Order dated 30.03.2022 as well as the demand notice of even date are hereby quashed and set aside. It will be open for the Department to issue fresh notice to the Assessee, if statutorily permitted. The petition succeeds and is accordingly allowed. Rule is made absolute to the aforesaid extent. No order as to costs.
(BHARGAV D. KARIA, J) (D.N.RAY,J) BINA SHAH Page 7 of 7 Uploaded by BINA SHAH(HC00353) on Tue Apr 22 2025 Downloaded on : Sat Apr 26 05:02:23 IST 2025