Income Tax Assessment against a Company Deregistered by MCA is Invalid: ITAT [Read Order]

The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) has held that the income tax assessment against a company deregistered by the Ministry of Corporate Affairs (MCA) shall be invalid since the same was issued against a person not in existence.

The assessee contended before the authorities that the notice under section 148 of the Income Tax Act was issued on a non-existing company when the name of the company was struck off as a defunct company by Registrar of Companies vide order dt. 18/05/2011 and hence the company was not in existence on and from 18/05/2011.

While quashing the order of the department, the two-Member bench comprising Judicial Member Ms. Suchitra Kamble and Accountant Member Waseem Ahmed held that “it is matter of record that One Mr. Dhirajlal Terraiya vide letter dated 25.08.2015 in his reply to Show Cause Notice dated 18.08.2015, intimated the ITO Ward 2(1)(4) that the company was struck off from the records of Registrar of Companies (ROC), Gujrat, vide order dated 18.05.2011.”

Upholding the contentions of the assessee, the Tribunal added that “thus, the company is no longer in existence after being struck off from the Register of ROC. In absence of existing company, there cannot be any director who can sign the verification for the filing of Income Tax Return or making any compliances or replying to any notices from Income Tax Department. The struck off company i.e. Mehta Air Travel Pvt. Ltd. was not in existence on the date of passing Assessment Order. Hence, the present Assessment order is not valid and the same may be quashed. The assessment order for Assessment Year 2008-09 is set aside.”

To Read the full text of the Order CLICK HERE

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