Ge Medical Systems (india) Pvt. Ltd.,, Bangalore v. Dcit, Bangalore

Per Shri Jason P. Boaz, A.M. : These are cross appeals by Revenue and the assessee, preferred against the final order of assessment dt.30.12.2014 passed under Section 143(3) rws 144C(13) of the Income Tax Act, 1961 (in short the Act) in pursuance to the directions dt.28.11.2014 issued by the Dispute Resolution Panel ( DRP ) Under Section 144C(5) of the Act.

2. The facts of the case, briefly, are as under :- IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd.

2.1 The assessee company is engaged in the manufacture and selling of Medical Equipment, undertakes engineering related services worldwide and renders software development services and IT Enabled services to its group companies. For Assessment Year 2010-11, the assessee filed its return of income on 4.10.2010 declaring income of Rs.61,30,89,140. The return of income was processed under Section 143(1) of the Act and the case was subsequently taken up for scrutiny. In the course of assessment proceedings, the Assessing Officer; on noting that the assessee had reported international transactions in Form No.3CEB made a reference under Section 92CA of the Act to the Transfer Pricing Officer ( TPO ) for determining the Arm s Length Price ( ALP ) of the said international transactions. The TPO after examining the assessees T.P. documentation rejected the same for all three segments, namely (i) Contract manufacturing, (ii) Software development services and (iii) Engineering Support Services and ITES. The TPO then undertook his own T.P. Study and after obtaining the assessees submissions in the matter passed an order under Section 92CA of the Act dt.30.1.2014 wherein the T.P. Adjustments proposed were as under :- S.No. Particulars Amount Rs.

1. Software development services 4,40,47,940

2. IT Enabled Services 13,81,98,347

3. Contract Manufacturing 64,90,07,221 Total Adjustments u/s.92CA 83,12,53,508 The Assessing Officer then completed the draft assessment under Section 143(3) of the Act vide order dt.28.2.2014 adding the proposed TP Adjustments of Rs.83,12,53,508 to the returned income of the assessee. IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd.

2.2 Aggrieved with the draft order of assessment dt.28.2.2014 for Assessment Year 2010-11, the assessee preferred its objections thereto before the DRP, Bangalore. The DRP issued its directions thereon under Section 144C(5) of the Act on 28.11.2014 and under Section 154 r.w.s. 144C(5) of the Act on 28.11.2014 and under Section 154 r.w.s. 144C(5) of the Act dt.16.12.2014. In pursuance thereof, the Assessing Officer completed the final order of assessment for Assessment Year 2010-11 under Section 143(3) rws 144C(13) of the Act vide order dt.30.12.2014 wherein the income of the assessee was determined at Rs.129,48,856 which included T.P. Adjustment of Rs.68,67,29,714.

3. Both Revenue and the assessee are aggrieved by the impugned order of assessment dt.30.12.2014 for Assessment Year 2010-11 and have revised the following grounds :- Grounds of appeal raised by the assessee are as under :-

1. That the order of the authorities below, the directions of the Dispute Resolution Panel (DRP) and the order of the transfer pricing officer in so far as it is against the appellant is against the law, facts, circumstances, natural justice, equity, without jurisdiction, bad in law and all other known principles of law.

2. That the total income computed and the total tax computed is hereby disputed. VALIDITY OF ASSESSMENT/JURISDICTION

3. The authorities below erred in framing an assessment against the appellant company which ceased to exist, consequent to the order of merger dated: 24.07.2013 of Karnataka High Court effective from

01.04.2012. Thus, the authorities erred in making an order of assessment against a non-existent entity on the date of assessment.

4. The authorities below ought to have appreciated that the successor company is assessed to tax in Bangalore before DCIT, Circle-7(1)(2) with PAN No. AAACW1685J. Framing of assessment by the authorities amounts to passing of two assessments for the same year which is clearly unwarranted under the Act. ISSUE OF TRANSFER PRICING

5. That the communication / order of the Transfer Pricing Officer is without jurisdiction, against the law, facts, circumstances, natural justice, equity and all other known principles of law. IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd.

6. That the findings, reasons, conclusions and directions of Dispute Resolution Panel (DRP) u/s 144C are a bundle of contradictions and clearly unsustainable in law requires to be rejected. Consequently the addition based on such directions requires to be deleted.

7. The DRP erred in not considering the relevant materials, evidences and data and the directions issued are without application of mind.

8. That the order of the DRP and the directions given therein are bad in law and not as per law requires to be cancelled.

9. That the AO/TPO/DRP erred in not providing adequate and sufficient opportunity as required under law thus violating the principle of natural justice, hence on this ground alone the orders requires to be annulled.

10. The appellant denies the tax liability on the surplus arising on the computation of arms length price for the impugned assessment year.

11. The Learned Assessing Officer erred in bringing to tax u/s 92CA as outlined below in the table as per the communication/order of the Transfer Pricing Officer and the directions of DRP. Sl.No Description Amount 1 Arm s Length Price difference in Software services Rs. 2,65,22,495/- 2 Arm s Length Price difference in the Contract Manufacturing Rs. 64,90,07,221/- Total adjustment U/s 92CA Rs. 67,55,29,716/-

12. The AO erred in wrongly adopting the adjustment u/s 92CA at Rs. 68,17,29,716/- as against the actual amount of Rs. 67,55,29,716/-.

13. The AO/TPO/DRP erred in making adjustment of Rs. 2,65,22,495/- towards the Software Services, while determining the ALP of the international transactions of the appellant.

14. The AO/TPO/DRPerred in making an adjustment of Rs. 64,90,07,221/- towards the Contract Manufacturing segment, while determining the ALP of the international transactions of the appellant.

15. The learned DRP erred in summarily rejecting the objections of the appellant with regard to the non providing of adequate and sufficient opportunity as required under law by the TPO before passing order u/s 92CA.

16. The AO/TPO failed to follow/giving effect to the directions of the DRP.

17. The AO/DRP erred in upholding the TPO s contention of adopting CPM as the most appropriate method for bench marking the contract manufacturing segment.

18. The AO/DRP erred in not following the orders of the CIT(A) and DRP for earlier years in the appellant s own case on similar issue, when the facts being the same for this year.

19. The AO/TPO/DRP erred in not carrying out the adjustments sought by the assessee.

20. That the AO/DRP erred in holding that ipso facto the determination/calculation of arm s length price amounts to earning of income by the appellant, thereby taxable in its hands.

21. The order of the Transfer pricing officer, directions of DRP and that of the AO is in clear violation of the law on this issue and the principles enunciated by various courts more particularly on the issue of reference, sanction of approval, recording of reasons and lack of satisfaction.

22. That no copy of the reasons recorded for making the reference to the TPO has been furnished nor copy of the approval obtained for making the reference has been furnished to the appellant. IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd.

23. The TPO erred in ignoring the fact that before making an adjustment neither a comparable transaction entered into has been identified nor the enterprise which has entered into such a transaction has been identified. Unless these two are identified as explained in Rule 10B(2) no further proceedings are possible. In this case, in view of non-identification, the entire order requires to be vacated.

24. The authorities below erred in ignoring the method followed by the appellant. The authorities below ought to have adduced cogent reasons for rejecting the method followed by the appellant before substituting and prescribing a new method.

25. The onus is on the department to establish there is any tax avoidance and it is essential that incontrovertible evidences are in the possession of the AO before a reference is made as held by the Supreme Court in 131 ITR 597 [LQ/SC/1981/368] and further has erred in not relying on the circular.

26. The Learned AO/TPO/DRP have failed to identify comparables in terms of Rule 10B(3).

27. The Learned AO/TPO/DRP failed to make the necessary adjustments as is required in terms of Rule 10B(2).

28. The AO/TPO/DRP erred in not granting the variances deduction of 5% envisaged in the Act and Circular.

29. No opportunity was given to the assessee before making the reference and before according the approval by the CIT. This is against the principles set out by the Hon ble Supreme Court in Rajesh Kumar vs. DCIT - 287 ITR 91 [LQ/SC/2006/1022] . ISSUE OF INTEREST U/S 234B AND 234C

30. The appellant denies the liabilities for interest u/s 234B& 234C of the Act. Further prays that the interest if any should be levied only on returned income.

31. No opportunity has been given before the levy of interest u/s 234B& C of the Act.

32. Without prejudice to the appellant s right of seeking waiver before appropriate authority the appellant begs for consequential relief in the levy of interest u/s 234B and 234C.

33. The appellant denies liability for interest u/s 234B on the adjustment made u/s 92CA of the Act and relies on the decision of the Supreme Court in the case of CIT v Kwality Biscuits Ltd reported in 284 ITR 434 [LQ/SC/2006/384] .

34. The appellant denies the liability for interest u/s 234D of the Act. No opportunity has been given before the levy of interest u/s 234D of the Act.

35. With prior permission of the ITAT, the appellant reserves the right to add/delete/amend any or all the ground stated above.

36. For the above and other grounds and reasons which may be submitted during the course of hearing of this appeal, the assessee requests that the appeal be allowed as prayed and justice be rendered. Revenue s Grounds of Appeal. 1. The order of the DRP is opposed to law and the facts and circumstances of the case.

2. The DRP erred in directing the Assessing Officer to carry out the working capital adjustment as per the actual figures worked out by the assessee without IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. putting any cap without appreciating the fact that the TPO had put a cap as the average cost of working capital of the comparables selected by the TPO was 1.71%.

3. The DRP erred in directing the exclusion of Infosys Ltd., ICRA Online, Acropetal Technologies, Eclerx Services Ltd., Nittany outsourcing Services Limited, KALS Information Systems, Persistant Systems and R S Softwre as comparables without appreciating the fact that the TPO had included the companies as rule 10B(3) requires that not only the transactions but the enterprises should also be comparable in TNMM.

4. The Honble DRP failed to appreciate that the directions issued are beyond the mandate of the provisions of section 144C of the IT Act.

5. Whether the Honble DRP, was right in super imposing the decision of other benches of ITAT in the case of assessee to reject these comparables when selectionof comparables in a case depends in transfer pricing onas. Specific FAR analysis.

6. Whether the Honble DRP instead of relying on decision of other benches of ITAT, ought to have decided the comparability of these companies on the basis of specific facts brought on record by the TPO in the case of the assessee.

7. The DRP erred in directing the Assessing Officer to follow the ratio of the Honble Court in the case of Tata Elxsi Ltd 349 ITR 98 [LQ/KarHC/2011/776] and exclude Rs.57,93,554 being the expenses incurred in foreign exchange on travel and Rs.1,085,000 insurance expenses respectively form the total turnover also while computing the deduction under Section 10A of the IT Act as the decision of the High Court is binding, without appreciating the fact that there is no provision in section 10A that such expenses should be reduced from the total turnover also, as clause (iv) of the explanation to section 10A provides that such expenses are tobe reduced ony from the export turnover.

8. The DRP erred in not appreciating the fact that the jurisdictional High Court s decision in the case of Tata Elxsi Ltd. 349 ITR 98 [LQ/KarHC/2011/776] has not been accepted by the department and an appeal has been filed before the Honble Supreme Court.

9. For these and such other grounds that may be urged at the time of hearing, it is humbly prayed that the order of the DRP be reversed and that of the Assessing Officer be restored.

10. The appellant craves leave to add, to alter, to amend or delete any of the grounds that may be urged at the time of hearing of the appeal.

4. Ground Nos.3 & 4  Validity of Assessment / Jurisdiction.

4.1.1 In the course of hearing before us, the learned Authorised Representative for the assessee sought to argue the grounds at S.Nos. 3 & 4 relating to the issue of validity of IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. assessment / jurisdiction which he contended went to the root of the matter; in as much as questioning the validity and jurisdiction of the order of assessment dt.30.12.2014 for Assessment Year 2010-11. It is the contention of the learned Authorised Representative, that the order of assessment for Assessment Year 2010-11 passed under Section 143(3) rws 144C(13) of the Act vide order dt.30.12.2014 has been passed by the Assessing Officer in respect of a non-existent entity in the name of GE Medical Systems Pvt. Ltd. ( GE ).

4.1.2 The learned Authorised Representative submitted that the facts in support of the above contentions are that  GE merged with Wipro GE Healthcare Pt. Ltd. ( Wipro  ) w.e.f. the appointed date of 1.4.2012. The order approving the merger between  GE and  Wipro was passed by the Honble Karnataka High Court on 24.7.2013, wherein the Court has retained the appointed date as 1.4.2012. This scheme was also approved by the Honble Delhi High Court by order dt.27.8.2012, wherein also the appointed date was mentioned assessee 1.4.2012. The learned Authorised Representative submits that as per the scheme of amalgamation / merger approved by the Honble High Court of Karnataka and Delhi, the issue of pending proceedings is dealt with in para 7(i) of the Scheme which is extracted hereunder :-  LEGAL PROCEEDINGS. 7(i). If any suit, appeal or any other proceedings of whatsoever nature (hereinafter called Proceedings) by or against the Transferor Companies is pending, the same shall not abate, be discontinued or in any way be prejudicially affected by reason of the transfer of the undertaking of the transferor Companies or anything contained in this Scheme; but the proceedings may be IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. continued, prosecuted and enforced by or against the Transferee Company in the same manner and to the same extent as it would be or might have been continued, prosecuted and enforced by or against the Transferor Companies, if this Scheme had not been made. In the above context, the learned Authorised Representative contended that, any proceedings may be continued, prosecuted and enforced by or against the transferee company in the same manner and to the same extent as it would be or might have been contained, prosecuted and enforced by or against the transferor company.

4.1.3 The learned Authorised Representative submitted that the facts in the case on hand were that,  GE filed the return of income for Assessment Year 2010-11 on 4.10.2010, after which the case was taken up for scrutiny by issue of notice under Section 143(2) of the Act dt.29.8.2011 which was duly served on the assessee. Subsequently, the Assessing Officer made a reference to the TPO for determining the ALP of the international transactions reported by the assessee in the year under consideration, who then passed an order under Section 92CA of the Act on 30.1.2014 suggesting T.P. Adjustments amounting to Rs.83,12,53,508. The Assessing Officer therefore concluded the proceedings by passing a draft order of assessment dt.28.2.2014. It is submitted by the learned Authorised Representative, that even before the draft assessment order was passed, the assessee vide letter dt.19.2.2014 (filed on 25.2.2014) brought to the notice of the Assessing Officer the fact of merger, but, however, the Assessing Officer without taking cognizance of the fact of merger passed the draft order of assessment on

28.2.2014 in the name of  GE the transferor company rather than  Wipro the transferee IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. company. It is submitted that thereafter, even though the assessee filed its objections in respect of the draft order of assessment before the DRP in Form No.35A in the name of Wipro GE Healthcare Pvt. Ltd. ( Wipro ), the DRP proceeded to issue its directions under Section 144C(5) of the Act vide order dt.28.11.2014 in the case of  GE which was by then merged, though the objections were filed by Wipro. Consequent to these directions by the DRP, the Assessing Officer passed the final order of assessment under Section 143(3) rws 144C(13) of the Act vide order dt.30.12.2014 again in the name of  GE .

4.1.4 In the light of the facts of the case put forth above, it was contended by the learned Authorised Representative for the assessee that on the day the final order of assessment under Section 143(3) rws 144C of the Act was made, i.e. on 30.12.2014, GE had already ceased to exist as a corporate entity and therefore the said order of assessment passed on a non-existent entity would be a nullity and invalid in the eyes of law. In support of this contention, the learned Authorised Representative placed reliance on the following judicial pronouncements  i) Impsat (P) Ltd. V ITO (91 ITD 354) (Del) ii) Hewlett Packard India Pvt. Ltd. in ITA No.4016/Del/2005 dt.28.4.2006 (Delhi- ITAT), wherein at paras 5, 6 and 12, it has been held as under :- 5. Since the registered office of H.P. Sales was at Bangalore a petition u/s.391 to 394 of the Companies Act, 1956 was presented by the transferee company for sanction of the scheme before the Honble Karnataka High Court. The Honble High Court by its order dt.28.5.2004 sanctioned the above scheme. The Court directed the transferee company within 30 days of the Court s order should file a certified copy of the Court s Order with the Registrar of Companies, Karnataka. Since the regd. Office of H.P. India was at Delhi a petition u/s.391 to 394 of the IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. Companies Act was also filed before the Honble Delhi High Court for sanction of the scheme. The Honble Delhi High Court by its order dt.12.2.2004 sanctioned the scheme of amalgamation. Thus consequent to the orders of the Honble High Court and the scheme of amalgamation H.P. India stood dissolved with effect from the appointed date without the process of winding up. Thus w.e.f. 1.4.03 H.P. India ceased to exist as an entity.

6. HP India for A.Y. 2002-03 filed its return of income on 30.10.2001. In the course of assessment proceedings vide letter dt.26.7.04 it informed the Assessing Officer that pursuant to the amalgamationof HP India with HP Sales, HP India stood dissolved eventhenotice u/s.143(2) had been issued on 23.10.2003. HP India pointed out that no assessment can be made on a company which is not in existence. The Assessing Officer however, considered this claim of the assessee and proceeded to frame the order of assessment. 7&& 8&.. 9&& 10&& 11&.

12. In view of the legal position as laid down in the aforesaid decisions, it is clear tha the assessment made in the present case in the name of HP India after the date of its dissolution is not valid. The fact that this company filed a return of income is not of any consequence. The order of assessment was made on 25.2.2005. As on this date HP India as an entity did not exist. The assessment is therefore held to be invalid and is cancelled. iii) ITO V Monsanto India Ltd. (ITA No.286 & 287/Bang/03, ITA Nos.307 to 309/Bang/2002 and ITA Nos.1070, 1895, 1896/Bang/04) and Monsanto India Ltd. V ITO C.O. Nos.28 to 34/Bang/06 dt.26.11.2007 (ITAT-Mumbai), wherein at paras 27, 33 and 34, it has been held as under :-  27 We have heard rival submissions and after considering the relevant material on record. the facts of the case and also the various case laws relied upon by the ld AR. we find that thc assessments in this case are void ab- initio because the company on which the assessments for these two years were completed were not in existence at the time of passing the assessment on 26.3.2002. The AO was duly informed by the assessee regarding the amalgamation with MIL. Copy of intimation dated 24.4.2001 and

20.2.2002 are placed at pages 195, 196 & 244 of the paper book. These letters are duly stamped by the respective officers of the departmental authorities. therefore, it cannot be said that there was no information with IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. the AO who com pieled the assessments on the assessee which was not in existence at the time of passing the assessment order. The Tribunal in the case of Makers Development Services Ltd in 40 lTD 185 has held as under: tI but there cannot be any doubt that, when two companies amalgamate and merge into one, the transferor company losses its entity as it ceases to have its business. However, their respective rights and liabilities are determined under the scheme of amalgamation but the corporate entity of the transferor company ceases to exist w.e.f. date of amalgamation is made effective. In the view of the above discussed we agree with the Tribunal s view that amalgamating company ceased to exist in the eye of the law. 28& .. 29& .. 30& . 31& .. 32& ..

33. The Supreme Court in the case of Marshall Sons & Co (India) Ltd has observed that amalgamation takes palace from the date mentioned in the scheme of amalgamation as sanctioned by the Court and not on the date of sanction of amalgamation or the date the amalgamating company was struck off the register of companies and assessment has to be made accordingly. 34 After taking into consideration the above decision, we find that the ratio of these decisions is squarely applicable on the facts of the prescn l case. In the present case, the assessee company was amalgamated w.c.f 1.4.2000 and the assessments were completed on

26.3.2002 which was after the date of amalgamation of the assessee into MIL, therefore, the assessments completed on non existence entity, in our considered view voi ab-initio. Accordingly we hold that the assessments for these years were invalid, therefore, they are quashed.

4.1.5 The learned Authorised Representative submits that the above orders, placed reliance upon, have been passed after considering and following the decisions of the Honble Apex Court in the case of Marshall Sons & Co. Ltd. V ITO (223 ITR 890), Saraswathi Industrial Syndicate Ltd. V CIT (186 ITR 278) [LQ/SC/1990/496] (SC) and of the Honble Madras High Court in CIT V Express Newspaper Ltd. 40 ITR 38 [LQ/MadHC/1960/68] (Madras High Court). The learned Authorised Representative prays that in the light of the factual matrix of the IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. case and in law, the impugned order of assessment for Assessment Year 2010-11 dt.30.12.2014 be held to be null and void.

4.2 Per contra, the learned Departmental Representative for Revenue submitted that the appointed date of 1.4.2012 was after the end of the Assessment Year 2010-11 and consequently, the decisions relied on by the learned Authorised Representative would not be applicable to a year prior to the appointed date. It was contended that even if the impugned order of assessment was made on a non-existent entity, the mistake, if any, is only procedural and not fatal and therefore the same was curable under Section 292B of the Act. The learned Departmental Representative further contended that  GE cannot object to the impugned order of assessment as it had filed the return of income for Assessment Year 2010-11 in the name of GE and had also participated in the assessment proceedings. The very fact of participation in the entire assessment proceedings by  GE would take away its right to question the validity of the assessment proceedings culminating in the passing of the impugned order of assessment. The learned Departmental Representative further submitted that the objections raised by the assessee on the issue of validity of assessment / jurisdiction was frivolous and not tenable and in this regard relied on the provisions of section 170(2) of the Act. It was accordingly prayed by the learned Departmental Representative that the grounds raised by the assessee on the issue of validity of assessment / jurisdiction be rejected.

4.3.1 In his rejoinder, the learned Authorised Representative for the assessee drew the attention of the Bench to the discussion of Delhi Tribunal in the case of Impsat (P) Ltd. V IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. ITO (supra), and particularly to para 22 thereof, to submit that the objections raised by the learned Departmental Representative for Revenue had already been dealt with by the Tribunal as under :-  22. The next question for our consideration is whether by filing the return of income in October, 2001, the assessee-company can be said to have admitted that it continued to be in existence so that the assessment made upon it may be held to be valid. This raises the question whether the assessee can consent to the AO making an assessment upon it, though there is no provision in the IT Act to do so. In Asit Kumar Ghose vs. Commr. of Agrl. IT (1952) 22 ITR 177 (Cal) [LQ/CalHC/1952/112] , the Calcutta High Court held that should an assessee file return or intervene in an assessment proceeding pending against an executor of an estate under the impression that he is liable to be charged as beneficiary of the estate, it is open to him, if he is not really liable at law, to appeal in proper time against the order of assessment against him and point out the invalidity of the assessment though he might have, by his conduct, acquiesced in the assessment proceedings. There can be no estoppel against statute. An assessment is to be governed by the provisions of the Act and not on the view which the parties may take as to their rights and labilities. In CIT vs. Bharat General Reinsurance Co. Ltd. (1971) 81 ITR 303 (Del), the Hon ble Delhi High Court held, where the assessee itself included the dividend in his return but later challenged the assessment of the same in the year in question, then it must be taken that the assessee had resiled from the position which it had wrongly taken while filing the return. In the light of these authorities, the conduct of the assessee before us in filing the return of income and in participating in the proceedings for assessment does not confer jurisdiction upon the AO to assess it, which must really depend upon the effect of the provisions of the IT Act. In the absence of any provision in the Act to assess a company that has been dissolved and thus ceased to exist, no assessment order can be made against it by the AO. The absence of a provision enabling the AO to do so cannot be supplied by the assessee by merely filing a return and participating in the proceedings.

4.3.2 The learned Authorised Representative further drew the attention of the Bench to para 3 of the Scheme of Amalgamation / Merger.  3. TRANSFER OF UNDERTAKINGS The whole of the Undertakings of the Transferor Companies, whether moveable or immovable, real or personal, corporeal or incorporeal, present or contingent, including but without being limited to all assets, fixed assets, work in progress, current assets, investments, reserves, provisions, funds, quota rights, import quotas, licenses, registrations, patents, trade name, trademarks IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. and other industrial rights and licenses in respect thereof, leases, tenancy rights, flats, telephones, telexes, facsimile connections, installations and utilities, benefits and agreements and arrangements, powers, authorities, permits, allotments, approvals, consents, privileges, liberties, easements and all the rights, title, interest, benefit and advantage of whatsoever nature and wheresoever situated belonging to or in the possession or granted in favour of or enjoyed by the Transferor Companies shall, pursuant to the provisions of Section 394(2) of the Act, without any further act or deed, be transferred to and vested in or be deemed to be transferred to and vested in the Transferee Company as a going concern, with effect from the Appointed Date, in the following manner: (a) With effect from the Appointed Date, the whole of the Undertakings as aforesaid of the Transferor Companies, except for the portions specified in sub - clause (b) and (c) below, of whatsoever nature and wheresoever situated and incapable of passing by manual delivery, shall, under the provisions of Sections 391 and 394 of the Act, without any further act or deed, be transferred to and be vested in the Transferee Company so as to vest in the Transferee Company all the right, title and interest of the Transferor Companies therein. (b) All the moveable assets including cash in hand, units of mutual funds, market instruments and other securities, if any, of the Transferor Companies, capable of passing through manual delivery or endorsement and delivery shall be so delivered or endorsed and delivered, as the case may be, to the Transferee Company to the end and intent that the property therein passes to the Transferee Company, on such delivery or endorsement and delivery, IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. t pursuant to the provisions of Section 394(2) of the Act without requiring any deed or instrument of conveyance for transfer of the same, subject to the provisions of the Scheme. Such delivery and transfer shall be made on a date mutually agreed upon between the respective Board of Directors of the Transferor Companies and the Board of Directors of the Transferee Company, within 30 (thirty) days from the Effective Date. (c) In respect of movables other than those specified in sub-clause (b) above, including sundry debtors, outstanding loans and advances, if any, recoverable in cash or in kind or for value to be received, bank balances and deposits, if any, with government, semi- government, local and other authorities and bodies, the following modus operandi shall, to the extent possible, be followed& .

4.3.3 The learned Authorised Representative submitted that consequent to the vesting of such assets/liabilities, the corporate entity  GE ceased to exist. It was also submitted with regard to the learned Departmental Representative relying on section 170(2) of the Act, that this aspect has also been looked into and considered by the ITAT, Delhi in the case of Hewlett Packard India Pvt. Ltd. (supra). The learned Authorised Representative contended that in the light of the above, the impugned order of assessment for Assessment Year 2010-11 is to be vacated on the preliminary issue of validity of assessment and jurisdiction. IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd.

4.4.1 We have heard the rival submissions and perused the records including the concerned orders of assessment, the direction of the DRP and the judicial pronouncements cited on the grounds raised by the assessee on the issue of validity of assessment / jurisdiction, and are of the view that these grounds at S.Nos.3 & 4 go to the very root of the matter and are therefore to be considered at the outset. We have perused the order of the Honble High Court of Karnataka approving the scheme of amalgamation / merger of  GE and  Wipro and also that of the Honble High Court of Delhi in this regard. Both the Honble High Courts in their orders have confirmed 1.4.2012 as the appointed date and therefore the legal effects of these orders are w.e.f. 1.4.2012; the appointed date. The legal consequences are laid out at para 3(a) to (c) of the scheme of amalgamation under  Transfer of Undertaking (cited supra) and in that regard any proceeding can be continued or prosecuted against only the transferee company after the date of court order. The Honble Apex Court has explained the legal position in the cases of Marshall Sons & Co. (India) Ltd. V ITO (supra) and Saraswathi Industrial Syndicate Ltd. V CIT (supra) which has been relied on by the ITAT, Delhi Bench in the case of Impsat (P) Ltd. (supra) and by the ITAT, Mumbai Bench in the case of Monsanto India Ltd. (supra).

4.4.2 We find that in the case on hand, the proceedings have been continued in the name of  GE rather than, as was warranted, in the name of  Wipro even after the appointed date of 1.4.2012 rendered by both the Honble High Courts of Karnataka and Delhi. We find that the draft order of assessment was passed on 28.2.2014 after the last hearing took place in both the Honble High Courts of Karnataka on 24.7.2013 and IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. Delhi on 27.8.2013. Thereafter, even though  Wipro filed the objections in Form No. 35A before the DRP, the DRP has continued the proceedings in the hands of  GE rather than  Wipro . We also find that the impugned final order of assessment for Assessment Year 2010-11 has also been passed by order dt.30.12.2014 in the hands of  GE which was non- existent as on the date of the order of assessment. In our view, the legal position is very clear in that any order made on a non-existent entity is a nullity and invalid. Applying these principles to the case on hand, we hold that the impugned final order of assessment for Assessment Year 2010-11 dt.30.12.2014 passed in the name of  GE is null and void and the assessment is therefore held to be invalid and accordingly cancelled as the same has been passed after the appointed date 1.4.2012 on a non-existent entity. We hold and direct accordingly. Consequently Ground Nos.3 and 4 of the assessees appeal are allowed.

5. In view of our decision on the preliminary grounds at S.Nos.3 & 4 on the issue of validity of assessment / jurisdiction (supra), the other grounds and issues raised by the assessee at S.Nos.1, 2 and 5 to 36 and by Revenue at S.Nos.1 to 10 of their respective appeals, are not taken up for consideration.

6. In the result, the Assessees appeal for Assessment Year 2010-11 stands allowed and Cross appeal of Revenue stand dismissed. Order pronounced in the open court on 04.11.2015. Sd/- (VIJAYPAL RAO) Judicial Member Sd/- (JASON P BOAZ) Accountant Member *Reddy gp IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd. Copy to :

1. Appellant

2. Respondent

3. C.I.T.

4. CIT(A)

5. DR, ITAT, Bangalore.

6. Guard File. (True copy) By Order Asst. Registrar, ITAT, Bangalore IT(T.P)A Nos.224 & 328/Bang/2015 GE Medical Systems (India) Pvt. Ltd.

1. Date of Dictation &&&&&&&&&&&&& ..

2. Date on which the typed draft is placed before the dictating Member &&&&&&&& .

3. Date on which the approved draft comes To Sr. P. S. &&&&&&&&&&&&&& ..

4. Date on which the fair order is placed before the dictating Member &&&&&& ..

5. Date on which the fair order comes back to the Sr. P.S. &&&&&&&&&&&&&&&& ..

6. Date on which the file goes to the Bench Clerk &&&&&&&&&&&&&&&&&&& ..

7. Date on which the file goes to the Head Clerk&&&&&&&&&&&&&&&&&&&&& .

8. Date on which the file goes to the Assistant Registrar / Sr. P.S. &&&&&& ..

9. Date of dispatch of the order &&&&&&& .