Bombay High Court
Reliance Industries Limited vs Additional/Joint/Deputy … on 22 April, 2026
2026:BHC-OS:11281-DB WP-4001-25 & ITR Group.doc
JVS.
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO. 4001 OF 2025
Reliance Industries Limited } Petitioner
Versus
Deputy Commissioner of Income Tax, }
Circle 3(4), Mumbai } Respondent
WITH
WRIT PETITION NO. 3359 OF 2025
Reliance Industries Limited } Petitioner
Versus
Deputy Commissioner of Income Tax, }
Circle 3(4), Mumbai } Respondent
WITH
WRIT PETITION NO. 2980 OF 2025
Reliance Industries Limited } Petitioner
Versus
Additional/Joint/Deputy }
Commissioner of Income Tax, Circle }
3(4), Mumbai } Respondent
Mr. J. D. Mistri, Senior Advocate with Mr. Madhur Agarwal,
Mr. Fenil Bhatt, Mr. Amit Mathur, Mr. P. C. Tripathi,
Mr.Ketan Dave, Mr. Gaurav Gangal and Mr. Pratik Shah
i/b. A. S. Dayal & Associates, Advocates for Petitioners.
Mr. Anil C. Singh, Additional Solicitor General with Mr.
Aditya Thakkar, Ms. Savita Ganoo, Ms.Sangeeta Yadav and
Mr. Arjun Gupta, Advocates for Respondents.
CORAM: SHREE CHANDRASHEKHAR, CJ. &
SUMAN SHYAM, J.
DATE: 22nd APRIL 2026
Per Shree Chandrashekhar, CJ.:
M/s Reliance Industries Ltd.1 has challenged the notices
issued to it under section 143(2) and section 142(1) of the Income
Tax Act, 1961 and the proceedings thereto in respect of different
assessment years. In Writ Petition No. 4001 of 2025, the petitioner-
1. M/s. Reliance Industries Ltd.
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company has challenged the notice dated 17 th July 2025 under
section 143(2) and a notice dated 26th August 2025 under section
142(1) under the Income Tax Act for A.Y. 1995-96. The Revenue
issued similar notices under section 143(2) and section 142(1) of
the Income Tax Act to the petitioner-company for A.Y. 1993-94 and
A.Y. 1994-95 which are under challenge in other two writ petitions
viz. Writ Petition No. 2980 of 2025 qua A.Y. 1993-94 and Writ
Petition No. 3359 of 2025 qua A.Y. 1994-95.
2. A common question of law is involved in all these matters;
whether the decision of this Court rendered on 14 th February 2025 in
a batch of the Income Tax Appeals and a writ petition filed by the RIL
contained a “finding” and any “direction” necessary for a decision in
those matters on merits? These writ petitions were heard on
different dates and the rival parties advanced similar arguments in
all three matters regarding legality or otherwise of the notices
issued to the petitioner-company and are disposed of by this
common order. As the circumstances in which the impugned
notices have been issued in all three matters are similar, the brief
facts narrated in Writ Petition No. 4001 of 2025 shall be referred to
by the Court for the sake of brevity.
3. Briefly stated, the RPPL2 filed its return of income on
30th November 1995 for the period between 1 st January 1995 to
31st December 1995 for A.Y. 1995-96. The RPEL 3 also filed its
return of income for the same period on 30 th November 1995. Both
the RPPL and RPEL were independent entities at the relevant point
of time and have merged with the RIL on 1 st January 1995
pursuant to an order dated 11 th January 1995 passed by this Court
which approved the merger of the RPPL and RPEL with the RIL. The
Assessing Officer revised the returns filed by the RPPL and RPEL on
2. Reliance Polypropylene Limited
3. Reliance Polythylene Limited
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30th November 1995 and an assessment order was passed on
28th February 1998 under section 143(3) of the Income tax Act
against the RPPL assessing its income to the tune of
Rs.25,96,62,130/- and ordered initiation of penalty proceedings
under section 271(1)(C) of the Income Tax Act for concealment of
the income and furnishing incorrect particulars. A similar order of
assessment in the case of RPEL was also passed on 28 th February
1998 under section 143(3) of the Income Tax Act assessing its
income at Rs.24,16,60,300/- and the penalty proceedings under
section 271(1)(C) of the Income Tax Act were ordered to be initiated
against it. These assessment orders passed in the name of the RPPL
and RPEL were challenged by filing the statutory appeals which
were decided by the Commissioner of Income Tax (Appeals) being
the first appellate Authority by an order dated 13 th February 2003.
The order passed by the first appellate Authority was challenged
before the Tribunal both by the Revenue and the petitioner-
company which were disposed of by an order dated 21 st December
2006.
4. Aggrieved thereby, the RIL filed Writ Petition No. 772 of 1999
and Income Tax Appeal Nos. 1313 of 2007, 1380 of 2007, 970 of
2007, 971 of 2007, 722 of 2007 and 723 of 2007 and challenged
the order passed by the Tribunal on 21st December 2006. The
Revenue also preferred Income Tax Appeal Nos. 6033 of 2010 and
6099 of 2007 to challenge the said order passed by the Tribunal.
During the pendency of Writ Petition No. 772 of 1999 and the
Income Tax Appeals filed by the RIL and the Revenue, a substantial
question of law was framed as to; “whether on the facts and
circumstances of the case and in law, the assessment order under
section 143(3) of the Act passed on a non-existent entity is bad in
law, void ab initio”?
5. In the judgment delivered on 14th February 2025, the stand
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taken on behalf of the Revenue that the RIL took over all the
liabilities as per the merger order and cannot shrug off its
obligation by raising a belated plea of jurisdiction was not accepted
by this Court. This Court held that the Assessing Officer had the
knowledge of merger of the RPPL and RPEL with the RIL but he
passed the assessment orders against the non-existing entities.
This Court held that the apprehension of the Revenue that it may
not be able to pass an order in the name of the RIL on account of
the limitation under the Income Tax Act was prima facie not correct
and the Revenue was free to take appropriate action, in accordance
with law, against the RIL if the law so permits. It was further held
that there are sufficient provisions in the Income Tax Act, such as,
sections 153(5), 153(6), 150 etc. to take care of this situation. This
Court further observed and clarified that the Revenue was not
precluded from initiating fresh proceedings against the RIL in
accordance with law for assessing the income in the hands of the
successor company. By the judgment dated 14 th February 2025, the
Income Tax Appeals filed by the RIL were allowed and,
consequently, the Income Tax Appeals filed by the Revenue were
rendered infructuous. However, on a statement made on behalf of
the RIL that the grievance raised in the writ petition would not
survive if the appeals filed by the RIL are allowed and the Revenue’s
appeals are consequently dismissed, Writ Petition No. 772 of 1999
was disposed of as infructuous. In the judgment dated
14th February 2025, this Court held as under: –
“25. As stated by us above, the Assessing Officer who has passed
the assessment orders for the assessment year 1994-95 on 27 March
1997 had knowledge that RPEL and RPPL have merged with RIL. The
dates are not disputed by the respondent-revenue of intimation and
notes to accounts and computation of income which are referred to
hereinabove. The existence and contents of these documents are also
not disputed. The dates of these documents are prior to the
assessment orders. Therefore, it can be safely concluded that the
assessment orders have been passed in the name of RPEL and RPPL4
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knowledge that such entities did not exist.
26. We are conscious that this plea is taken after almost 3 decades
at the stage of third appeal but for the reasons which we have stated
in our order dated 20 January 2025, since it being a jurisdictional
issue going to the root of the matter, we cannot restrain ourselves
from not permitting and not adjudicating upon the same merely on the
ground that such a plea is taken after almost 3 decades.
27. The plea of the respondent-revenue is that if the appeals are
allowed on this ground, then they may not be able to pass an order in
the name of the amalgamated entity-RIL on account of the limitations
provided under the Act. Prima facie, we do not agree that the
consequences of allowing the jurisdictional plea would result into
depriving the revenue of assessing and passing an order in the name
of the amalgamated company-RIL on account of limitation. There are
sufficient provisions in the Act to take care of this situation based on
the order passed by various authorities, for e.g. Sections 153(5),
153(6), 150 etc. Revenue is free to take appropriate action, in
accordance with law, to give effect to the submissions of the
appellant-assessee if the law so permits. We may also note and
accept that the consequence of the appellant-assessee’s submission is
that the revenue ought to have assessed and passed the order in the
name of the amalgamated company-RIL. If that be so, then the
revenue is free to take appropriate proceedings under the Act in
accordance with law for assessing the amalgamated company-RIL
since the appellant-assessee’s submission impliedly admits that the
assessment ought to have been done in the name of RIL and not in the
name of the amalgamating companies RPEL and RPPL.
28. The reliance placed by the respondent-revenue on the decision
of the Supreme Court in the case of Mahagun Realtors (P) Ltd. (supra)
is distinguishable. This decision was rendered on 5 April 2022 and in
which the decision of the Supreme Court in the case of Maruti Suzuki
India Ltd. (supra) was also considered. In the case of Mahagun
Realtors (P) Ltd. (supra), after the merger order, return of income was
filed in the name of the amalgamating company. In the said return of
income, PAN of the amalgamating company was mentioned. In the
return of income, the date of incorporation of the amalgamating
company was mentioned and in the form of return of income to a
specific query “Business Reorganization (a)……. (b) In case of
amalgamated company, write the name of amalgamating company”
the reply mentioned was “NOT APPLICABLE”. The appeal before the
Tribunal was also filed in the name of amalgamating company. It was
on these facts that the Supreme Court observed that since the
amalgamating company did not inform the revenue about the
amalgamation but held out to the revenue as if the amalgamating
company is in existence, the Supreme Court did not accept the
submission made by the assessee that the proceedings were taken
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against the non-existing company. In the present case before us, the
respondent-revenue has not pointed out how the facts in the present
case are identical to the facts of Mahagun Realtors (P) Ltd. (supra)
which was the basis of the decision of the Supreme Court. These facts
are absent in the present matter before us, but on the contrary the
respondent-revenue had knowledge about the amalgamation/merger
as observed by us above and, therefore, the decision of Mahagun
Realtors (P) Ltd. (supra) is not applicable to the facts before us.”
6. Purportedly acting pursuant to the aforesaid decision of this
Court, the Revenue issued notices to the RIL under section 143(2)
and section 142(1) of the Income Tax Act for A.Y. 1993-94, A.Y.
1994-95 and A.Y. 1995-96. The petitioner-company has filed these
writ petitions to challenge the said notices issued to it and seeks
quashing of the entire proceedings initiated against it for the
aforesaid assessment years.
7. Mr. J. D. Mistri, the learned senior counsel for the petitioner-
company submits that the notice issued to the RIL under section
143(2) of the Income Tax Act is barred by limitation and, thus,
invalid and bad in law. The impugned notices have been issued to
the RIL in its standalone capacity and not as a successor to the
RPPL and RPEL inasmuch as the notices under section 143(2) and
section 142(1) of the Income Tax Act do not specify that such
notices have been issued to the petitioner-company in its capacity
as the successor company. Furthermore, the notices issued to the
petitioner-company shall also not survive if such notices have been
issued to it in its capacity as the successor to two different entities
because those notices constitute one composite notice with respect
to two separate proceedings and two different non-existing entities.
8. The Income Tax Act provides a complete procedure for
assessment under Chapter XIV. Section 139 provides that every
person (a) being a company or a firm or (b) being a person other
than a company or a firm shall on or before the due date furnish a
return of his income or the income of such other person during the
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previous year in the prescribed form if his total income or the total
income of any person in respect of which he is assessable under the
Act during the previous year exceeds the maximum amount which
is not chargeable to income tax. The third proviso to section 139
mandates that every company or a firm shall furnish on or before
the due date the return in respect of its income or loss in every
previous year. Section 142 contemplates an inquiry before
assessment and provides under sub-section (1) that the Assessing
Officer for the purpose of making an assessment under the Act may
serve on any person who has made a return or to whom a notice
was issued under sub-section (1) of section 139, whether a return
was made or not or in whose case the time allowed under sub-
section (1) of section 139 for furnishing the return has expired.
9. Section 143 provides the manner in which the return of
income filed by an assessee shall be processed whether a return of
income was made under section 139 or in response to a notice
under sub-section (1) of section 142. Sub-section (2) of section 143
vests power in the Assessing Officer to serve on the assessee a
notice requiring him, on a date to be specified therein, either to
attend the office of the Assessing Officer or to produce, or cause to
be produced before him any evidence on which the assessee may
rely in support of the returns to ensure that the assessee has not
understated the income or has not computed excessive loss or has
not under-paid in any manner any of such cases where the detail
has been furnished under Section 139 or in response to a notice
under sub-section (1) of Section 142. However, proviso to sub-
section (2) puts an embargo on the power of the Assessing Officer to
serve a notice on the assessee under sub-section (2). It provides
that no notice under this sub-section shall be served on the
assessee after the expiry of three months (as substituted by Finance
Act, 2021 with effect from 1 st April, 2021) from the end of the
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Financial Year in which the return is furnished.
10. Section 150 of the Income Tax Act provides that the notice
under section 148 may be issued at any time for the purpose of
making an assessment or reassessment or re-computation in
consequence of or to give effect to any finding or direction contained
in an order passed by the Authority in any proceedings under the
Income Tax Act by way of appeal, reference or revision or by a Court
in any proceeding in any other laws. Section 150 of the Income Tax
Act provides as under:
“[Provision for cases where assessment is in pursuance of an order on
appeal, etc.
150. (1) Notwithstanding anything contained in section 149, the
notice under section 148 may be issued at any time for the purpose of
making an assessment or reassessment or recomputation, in
consequence of, or to give effect to any finding or direction contained
in an order passed by –
(a) any authority in any proceeding under this Act by way
of appeal, reference or revision or
(b) a Court in any proceeding under this Act or any other
law.
(2) The provisions of sub-section (1) shall not apply in any
case where any such assessment or reassessment or recomputation
as is referred to in that sub-section relates to an assessment year in
respect of which an assessment or reassessment or recomputation
could not have been made, by reason of any other provision limiting
the time within which an action for assessment or reassessment or
recomputation may be taken, at the time when –
(a) the order which was the subject-matter of the appeal,
reference or revision, as the case may be, was made; or
(b) the proceedings relating to assessment or reassessment
or recomputation under this Act (other than those
proceedings which have culminated in an order), which
was the subject-matter before the Court was, initiated.
(3) For the purposes of sub-section (1), notice under section 148
shall be issued within a period of three months from the end of the
quarter in which the certified copy of the order of the authority or the
Court, as the case may be, is received by the jurisdictional Principal
Commissioner or Commissioner.]
11. Section 153 of the Income Tax Act is also a relevant provision
which may be taken note of. It puts a statutory restriction on
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passing an order of assessment under section 143 or section 144
after the expiry of 21 months from the end of the assessment order
in which the income was first assessable. Section 153 contains
eight sub-sections and several provisos which came to be
incorporated by the Finance Act of different years. Sub-section (6)
carves out an exception as to the provisions under sub-sections (1),
(1A) and 2 and enumerates the classes of assessment,
reassessment and recomputation which, subject to the provisions of
sub-sections (3), (5) and (5A), may be completed. It provides as
under:
“[Time limit for completion of assessment, reassessment and
recomputation.
153 (6) Nothing contained in sub-sections (1), (1A) and (2) shall apply
to the following classes of assessments, reassessments and
recomputation which may, subject to the provisions of sub-sections (3), (5)
and (5A), be completed–
(i) where the assessment, reassessment or recomputation is
made on the assessee or any person in consequence of or to give
effect to any finding or direction contained in an order under section
250, section 254, section 260, section 262, section 263, or section
264 or in an order of any court in a proceeding otherwise than by
way of appeal or reference under this Act, on or before the expiry of
twelve months from the end of the month in which such order is
received or passed by the Principal Chief Commissioner or Chief
Commissioner or Principal Commissioner or Commissioner, as the
case may be; or
(ii) where, in the case of a firm, an assessment is made on a
partner of the firm in consequence of an assessment made on
the firm under section 147, on or before the expiry of twelve
months from the end of the month in which the assessment
order in the case of the firm is passed.”
12. In “Murlidhar Bhagwandas”4, the Hon’ble Supreme Court held
that section 153(3)(ii) of the Income Tax Act puts a bar of limitation
for making an assessment order under section 143 or section 144
or section 147 and it does not in any manner enlarges the
jurisdiction of the authority or Court to make reassessment of the
4. Income Tax Officer, Award Sitapur v. Murlitdhar Bhagwandas, Lakhimpur Kheri: (1964)
52 ITR 335 (SC)
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income of an assessee. The statutory regime under the Income Tax
Act and, more particularly, the provision under sub-section (2) of
section 143 do not admit any exceptions except the situations as
indicated in the Income Tax Act. No judgment contrary to the
legislative intendment under sub-section (2) of section 143 has
been produced before the Court on behalf of the Revenue to carve
out an exception to the effect that the bar of limitation is not
attracted in the second round of litigation.
13. This is not in dispute that the judgment dated 14 th February,
2025 passed in the batch of Income Tax Appeals filed by the RIL
and Revenue was challenged by filing Special Leave Petitions which
have been dismissed by the Hon’ble Supreme Court. In the present
proceedings pending before this Court, the question of law which is
canvassed before this Court mainly centers around the
observations made by this Court in the judgment dated 14 th
February, 2025. The observation made in this judgment to the
effect that the Revenue would not be precluded from initiating fresh
proceedings against the RIL do not confer jurisdiction in the
Assessing Officer to act arbitrarily or without application of mind
and beyond its powers as conferred under the Income Tax Act. The
observations made by the co-ordinate Bench in paragraph No.27
clearly puts the Assessing Officer on notice that he has to act ‘in
accordance with law’. The point of law canvassed on behalf of the
Revenue is not a complicated question and the issue is resolved on
a plain reading of the judgment dated 14 th February, 2025.
14. Mr. Anil C. Singh, the learned Additional Solicitor General
appearing for the Revenue, however, contended that the order of
this Court that the assessment order ought to have been and
should be passed in the name of the RIL is a “finding” based on
which the judgment dated 14th February 2025 was rendered by this
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Court. In our opinion, the observations made in the judgment dated
14th February, 2025 do not contain any reasoning which may be
construed as a ‘finding’ necessary for disposing off the Income Tax
Appeals filed by the RIL and the Revenue, as contemplated under
section 150 or section 153(6) of the Income Tax Act. In “Rajinder
Nath Etc.”5, the scope of the expressions “finding” and “direction” in
section 153(3)(ii) of the Income Tax Act, which provides the time
limit for completing the reassessment proceeding, was considered
by the Hon’ble Supreme Court. It was held that the “finding”
recorded by an appellate, revisional or reference Court or authority
would mean a finding necessary for the disposal of the case in
respect of a particular assessee and in relation to a particular
assessment year. By way of an example, it was indicated that if a
finding in respect of the liability of an assessee can be directly
recorded without relying upon some finding recorded in respect of
another individual or entity then any finding recorded in relation to
such an individual or entities shall be an incidental finding and not
a finding as contemplated under section 153(3)(ii) of the Income Tax
Act.
15. The judgment dated 14th February, 2025 has been clearly
misinterpreted and misconstrued by the Revenue as to conferring
jurisdiction in the Assessing Officer to act in the matter
notwithstanding a clear bar to issue a notice under sub-section (2)
of section 143. This is also incorrect to say that the rigors of
limitation under proviso to sub-section (2) shall not be attracted in
this case in the second round of litigation. The impugned notices
under section 143(2) have been issued to the petitioner-company
beyond the statutory period of three months from the end of the
Financial Year in which the returns were furnished by the RPPL
and RPEL. Mr. Mistri, the learned senior counsel rightly contended
5. Rajinder Nath & Ors. v. Commissioner of Income Tax, Delhi: (1979) 4 SCC 282
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that the notice for reassessment is required to be first issued to the
assessee and the further proceedings against the petitioner-
company cannot be initiated by merely issuing the impugned notice
under section 143(2) of the Income Tax Act. The Assessing Officer
has also failed to record his satisfaction and no material thereof has
been produced in the present proceedings that the Assessing Officer
was satisfied that it is expedient or necessary to scrutinize the
returns of the assessee.
16. Mr. J. D. Mistri, the learned senior counsel for the petitioner-
company referred to the decision in “Shell India Markets Private
Limited”6 to submit that the impugned notices issued to the
petitioner-company, even otherwise, warrant interference of this
Court in view of the said decision in “Shell India Markets Pvt. Ltd. 6”
which was rendered by this Court in similar situation and on
identical set of facts.
17. This is a matter of judicial discipline and propriety and
necessary to maintain uniformity in the judicial system that the
judgment in “Shell India Markets Pvt. Ltd.”6 rendered by a Division
Bench of this Court is followed by another Bench of co-equal
strength, with an exception of reference to a larger Bench. The
judgment rendered even on facts in a particular case cannot be
reopened and deviated by any co-ordinate Bench in a subsequent
case, which may not be even between the same parties. In “Chandra
Prakash”7, the Hon’ble Supreme Court held as under: –
“22.. The doctrine of binding precedent is of utmost importance in the
administration of our judicial system. It promotes certainty and
consistency in judicial decisions. Judicial consistency promotes
confidence in the system, therefore, there is this need for consistency
in the enunciation of legal principles in the decisions of this Court. It
is in the above context, this Court Raghubir Singh held that a
pronouncement of law by a Division Bench of this Court is binding on
6. Shell India Markets Private Limited v. The Deputy Commissioner of Income Tax, Circle-
3(4), Mumbai & Anr.: Writ Petition No. 4017 of 2025
7. Chandra Prakash v. State of U. P.: (2002) 4 SCC 234
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18. It is pointed out by Mr. J. D. Mistri, the learned senior
counsel for the petitioner-company that the judgment dated 14th
February 2025 rendered in the first round of litigation took note of
the decision in “Maruti Suzuki India Limited”8 to interfere with the
order dated 21st December 2006 passed by the Tribunal. In “Maruti
Suzuki India Ltd”, the Hon’ble Supreme Court held that the former
entity ceases to exist upon approval of the scheme of amalgamation
and the jurisdictional notice as well as the assessment order passed
thereto against the erstwhile company, which on the date of the
jurisdictional notice was a non-existing Company, is a substantive
illegality. “Maruti Suzuki India Ltd.” was rendered in the context of
section 292B of the Income Tax Act which provides that any notice,
summons, return of income or other proceeding furnished or made
or issued or taken or purported to have been furnished or made or
issued or taken under the Income Tax Act, 1961 shall not be invalid
or shall be deemed to be invalid merely by the reason of any
mistake, defect or omission in such return of income, assessment,
notice, summons or other proceeding provided such return of
income, assessment, notice, summons or other proceeding was in
subsistence and effect in conformity with or according to the intent
and purpose of the Income Tax Act. The Hon’ble Supreme Court
considered the previous decisions of Delhi High Court and the
decisions in “CIT v. M/s Spice Enfotainment Ltd.”9 and “Skylight
Hospitality LLP”10 and held that the assessee-company on
amalgamation with another company loses its existence and the
jurisdictional notice issued to the erstwhile assessee-company shall
not be merely a procedural violation as contemplated under section
8 In Principal Commissioner of Income Tax, New Delhi v. Maruti Suzuki India Ltd.: (2020)
18 SCC 331.
9. CIT v. M/s Spice Enfotainment Ltd.: Civil Appeal No. 285 of 2014 dated 2 nd November
2017
10. Skylight Hospitality LLP” v. Asst. CIT: ( 2018) 13 SCC 147
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292B of the Income Tax Act.
19. The law is, therefore, well settled that the former Company
ceases to exist in the eye of law when it is dissolved under the
scheme of amalgamation without winding up. The appeal filed by
the Revenue against the “Shell India Markets Pvt. Ltd.”6 came to be
disposed of with the following observations: –
“5. We agree with the submission made by Mr Bhatt, learned
counsel for the Respondent-Assessee that the notice and order should
been have issued in the name of the transferee company “Shell India
Market Private Limited” and not the transferor company “Shell
Technology India Private Limited”. The decisions relied upon by the
learned counsel for the Respondent-Assessee supports that if the
Assessing Officer has been intimated about the fact of merger, then
the notice should have been issued in the name of the transferee
company and not the transferor company. Since in the instant case
the notice and the assessment order is passed in the name of the
transferor company “Shell Technology India Private Limited” and not
the transferee company “Shell India Market Private Limited”, same
are bad.
6. However, we clarify that the present Appeal is dismissed only
on the ground that the notice and assessment order has been passed
in the name of the transferor company by accepting the submission of
the Respondent-Assessee that the orders could not have been made
against the non-existing company. The result and consequence of this
submission is that the Assessment order and the notice ought to have
been issued in the name of the transferee company and the not the
transferor company and contended by the Respondent-Assessee.
Accepting the same, we clarify that this order would not preclude the
Appellant-Revenue from initiating fresh proceedings against the
transferee company, in accordance with law for assessing the income
in the hands of the transferee company. We may also observe that
the consequence and effect of the submission and the order made
herein is that the income should have been assessed in the name of
the transferee company and not the transferor company.
7. The Appeal is disposed of in above terms. No order as to costs.”
20. For a similar reason, an identical order was passed by a co-
ordinate Bench of this Court in “Shell India Markets Pvt. Ltd.”11
upholding the decision of the statutory authority that an
assessment order could not have been made against a non-existing
11 Commissioner of Income Tax-LTU v. Shell India Markets Pvt. Ltd.: Income Tax Appeal
No.2381 of 2018 order dated 27.03.2025
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entity, namely, Shell Technology India Pvt. Ltd. Just to indicate,
that the Income Tax Appeal No. 2381 of 2018 11 was filed by the
Revenue to challenge the decision rendered by the Tribunal that no
notice could be issued and an assessment order could not have
been made pursuant thereto against a non-existing entity, namely,
Shell Technology India Pvt. Ltd.
21. Furthermore, the decision dated 17th November 2025 passed
in the second round of litigation in the “Shell India Markets Pvt.
Ltd.”6 reveals that the notices under section 143(2) and section
142(1) of the Income Tax Act issued to the said Company were
quashed by a co-ordinate Bench of this Court holding that the
order dated 27th March 2025 in Income Tax Appeal No. 2381 of
2018 did not contain any “finding” or “direction” as contemplated
under section 153(6) of the Income Tax Act and, consequently, no
order of assessment could have been passed against the said
Company in view of the bar of limitation under the Income Tax Act.
The co-ordinate Bench reflected on the expressions “not precluded
from initiating fresh proceedings” and “in accordance with law” in
the order dated 27th March 2025 and held that the said order 11 did
not contain any finding. Moreover, the decision dated 27 th March
2025 even assuming to have recorded a finding then also such
finding cannot be held to have been rendered on merits so as to
dispose of the appeal before the Court. In “Shell India Markets
Private Limited”6 the co-ordinate Bench held as under: –
“23. Applying these principles to the facts of the present case, we are
of the opinion that the order of this Court dated 27th March 2025
cannot be said to contain any “direction” within the meaning of the
word since the Court merely clarified that the revenue authorities
were not precluded from initiating fresh proceedings against the
transferee company (Petitioner) in accordance with law. The
emphasised words clearly rule out any question of a “direction” being
issued by the Court. This is also accepted by the Respondents. As to
whether the said order contained any “finding” within the meaning of
the word, we are of the view that in the first place there is no finding15
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consequence and effect of the submission made by the Petitioner
which had been accepted by the Court. Clearly an effect or
consequence can only arise after the submission has been accepted
by the Court. Ex facie this can never be a finding necessary to decide
the appeal before the Court. To put it differently, in order to decide
the appeal before it, the Court merely applied the principle laid down
in Maruti Suzuki‘s case (supra) and held that no assessment could be
made on a non-existing company. No consideration of the assessment
in the hands of the Petitioner was necessary to decide and finally
dispose of the appeal. Therefore, even assuming that a finding exists
it is clearly not a “finding” necessary to dispose of the appeal before
the Court. Accordingly, there is no question of the provisions of
Section 153(6) being attracted in the facts of the present case.
24. For all the reasons set out above, we are of the view that the
order of this Court in Income-tax Appeal No.2381 of 2018 dated
27th March 2025 does not contain any “finding” or “direction” as
contemplated by the provisions of Section 153(6) of the Act and
consequently no order of assessment could be passed in the case of
the Petitioner for the A.Y.2007-08 in view of the bar of limitation in
Section 153(1) of the Act.”
22. There is not even a bit of any tangible difference on facts in
the present case and “Shell India Markets Pvt. Ltd.”6 There is a need
for certainty in the judicial decisions and the element of certainty in
the judicial system shall disappear if the Judges of co-ordinate
jurisdiction in a High Court start overruling the decisions of
another Bench [vide, “Mahadeolal Kanodia”12]. In “Lala Shri
Bhagwan”13, the Hon’ble Supreme Court observed that if a learned
Judge of the High Court thinks that the earlier decision of the
Court requires reconsideration then he should refer the matter to a
larger Bench for examining the question involved in the case but
the learned judge should not embark upon an inquiry as to the
previous decision of the Court. In “Kalika Kuer”14, the Hon’ble
Supreme Court observed that the previous decision of the High
Court on the similar issue shall be binding on every Bench of co-
12 Mahadeolal Kanodia v. The Administrator-General of West Bengal: AIR 1960 SC 936
13. Lala Shri Bhagwan v. Ram Chand: AIR 1965 SC 1767
14. State of Bihar v. Kalika Kuer: (2003) 5 SCC 448
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equal strength and such a decision of the Court cannot be ignored
even if the previous decision may seem to be incorrect to another
Bench of a co-ordinate jurisdiction.
23. For the foregoing reasons, the impugned notices which are
under challenge in Writ Petition Nos. 4001 of 2025, 3359 of 2025
and 2980 of 2025 are quashed and the writ petitions are allowed to
that extent.
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