INCOME TAX ACT, 1961

Setion 153A Section 143(3)

Search and seizure - Assessment under section 153A - Validity - Search conducted on the basis of warrant of authorization issued in the name of non-existent entity

Assessee M/s. R.R. Gold Palace was formed in 2005 and was subsequently converted to a Private Limited company on 25-10-2011 by name M/s. R.R. Gold Palace (P) Ltd. and continued business as a going concern at the same premises. Assets and liabilities of erstwhile firm had been taken over by newly incorporated private limited company. Search action under section 132 was conducted on 8-2-2013 and warrant of authorization, dated 7-2-2013 was executed in the name of M/s. R.R. Gold Palace/M/s. R.R. Gold Palace (P) Ltd. The Punchanamas were drawn on various dates in the name of M/s. R.R. Gold Palace & M/s. R.R. Gold Palace (P) Ltd. Assessee challenged validity of consequent assessment framed under sectionsection 143(3) read with section 1253A. Held: On date of search, the firm ceased to exist on being convered into a private limited company as a going concern. Accordingly, search conducted on the basis of warrant of authorization issued in the name of non-existing entity and consequent assessment framed under section 243(3) read with section 153A were bad in law being nullity in the eyes of law.

Relied:Nahar Enterprises v. Dy. CIT ITA No. 2853/Mum/3015, dated 7-4-2017 : 2017 TaxPub(DT) 1302 (Mum-Trib).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2008-09 to 2011-12

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