Our transferor company merged into us and was dissolved, but the assessment order is still in its name — and separately, a section 148 notice has arrived in my late father's name. Is an order or notice on someone who does not exist simply void, or is it a mistake the department can put right?
An order made on a company that ceased to exist on amalgamation is a nullity, not an irregularity: in PCIT v Maruti Suzuki India Ltd (Supreme Court, 25 July 2019) the Court held that once the amalgamating company ceases to exist it is no longer a person under section 2(31) against whom an assessment can be made, that this is "a substantive illegality and not a procedural violation of the nature adverted to in Section 292B", and that participation by the amalgamated company is no estoppel. But PCIT v Mahagun Realtors (P) Ltd (Supreme Court, 5 April 2022) upheld an assessment framed on an amalgamating company on its own facts, holding that whether corporate death invalidates an order "would depend on the terms of the amalgamation and the facts of each case" — there the merger was never intimated for the year in question, the return was filed in the dissolved company's name answering "not applicable" to the business-reorganisation query, and the order named both companies. Section 170A, inserted by the Finance Act 2022 and substituted by the Finance Act 2023, gives the successor a modified return in Form ITR-A within six months of the end of the month of the court or tribunal order; it fixes the taxpayer's filings, not the department's order. The saving provision, section 170(2A) from 1 April 2022, only covers proceedings taken while the succession was pending as that word is defined. For a dead assessee the position is different again: a fresh section 148 notice must be issued to the legal representative by name, and the High Courts have not all said the same thing about whether an heir who participates loses the point.
Start with the fact, not the argument. When a scheme of amalgamation is sanctioned, the transferor company is dissolved and ceases to exist from the appointed date. It is not dormant, not struck off pending revival, not a shell with a PAN still live on the portal. It is gone. Everything else on this page follows from that, and so does the reason the department loses these cases: an assessing officer cannot assess a person who does not exist, and no amount of care taken over the computation cures it.
The governing authority is PCIT v Maruti Suzuki India Ltd, decided by the Supreme Court on 25 July 2019 (Civil Appeal No. 5409 of 2019, Chandrachud and Indira Banerjee JJ). Suzuki Powertrain India Ltd amalgamated into Maruti Suzuki India Ltd under a scheme sanctioned on 29 January 2013 with effect from an appointed date of 1 April 2012. Maruti Suzuki wrote to the assessing officer on 2 April 2013 telling him of the amalgamation. He issued the section 143(2) notice for assessment year 2012-13 on 26 September 2013 to Suzuki Powertrain anyway, and framed the assessment on it. The Court held that "Upon the amalgamating company ceasing to exist, it cannot be regarded as a person under Section 2(31) of the Act 1961 against whom assessment proceedings can be initiated or an order of assessment passed", and that the proceedings were void ab initio.
Three things the Court said in Maruti Suzuki are worth having at hand. On Spice Entertainment, the Delhi High Court decision that started this line, it set the passage out with approval: an assessment order in the name of the dissolved company "would clearly be void", "Such a defect cannot be treated as procedural defect", and "Mere participation by the appellant would be of no effect as there is no estoppel against law." It also recorded that the Revenue's appeals against Spice were dismissed by the Supreme Court on 2 November 2017. On section 292B it was direct: the notice went to a non-existent company and the order was made against it, and "This is a substantive illegality and not a procedural violation of the nature adverted to in Section 292B." And on section 170: at paragraph 31 the Court set out the whole of the section, sub-sections (1) to (4), and then decided nothing on it. The sentence in the judgment about not considering it necessary to go further belongs to the respondent's arguments on section 144C eligibility and section 153 limitation, not to section 170. So do not cite Maruti Suzuki as a decision on section 170, in either direction — it reproduces the section and leaves it alone.
Now the case that cuts the other way, because a page that gives you only Maruti Suzuki will get you into trouble. In PCIT v Mahagun Realtors (P) Ltd (Supreme Court, 5 April 2022, Lalit and Ravindra Bhat JJ) the Court upheld an assessment framed on the amalgamating company. Mahagun Realtors amalgamated into Mahagun India with an appointed date of 1 April 2006 under a High Court order of 10 September 2007. The year in issue was 2006-07. A search took place on 27 August 2008 and nothing was said about the amalgamation. The notice calling for a return for that year issued on 2 March 2009, under section 153A, on the back of the search. The return was filed on 28 May 2010 in Mahagun Realtors' name and under its PAN, and against the query on business reorganisation it said "NOT APPLICABLE". The assessment order of 11 August 2011 described the assessee as "Mahagun Relators Private Ltd, represented by Mahagun India Private Ltd", and the appeals were filed in that same combined form. The counter-affidavit in the Supreme Court was signed by a director of the dissolved company.
State the distinction the way the Court stated it, because Mahagun Realtors is mis-cited in both directions. It did not overrule Maruti Suzuki and it did not hold that an order on a dissolved company is a curable irregularity. What it held is that the question is not answered by the fact of dissolution standing alone: whether corporate death on amalgamation "per se invalidates an assessment order ordinarily cannot be determined on a bare application of Section 481" of the Companies Act, "but would depend on the terms of the amalgamation and the facts of each case". The distinction the Court drew from Maruti Suzuki and Spice was about disclosure and conduct: in those cases "the assessee had duly informed the authorities about the merger of companies and yet the assessment order was passed in the name of amalgamating/non-existent company", whereas for assessment year 2006-07 there was no intimation at all, the return suppressed the amalgamation, the assessee litigated throughout in the dissolved company's name, and both the draft and the final orders named both companies. The appeal was allowed and the matter sent back to the Tribunal to be heard on everything except the nullity point. It turns on facts, and it is authority for a fact-sensitive enquiry — not for the proposition that naming a dead company is always fine, and not for the proposition that it never matters what the assessee did.
Section 170A is the taxpayer's route, and it is often confused with a saving provision. It was inserted by the Finance Act 2022 (Act No. 6 of 2022) with effect from 1 April 2022 and substituted by the Finance Act 2023 (Act No. 8 of 2023) with effect from 1 April 2023; the substituted text is the one on the department's page at /w/section-170a-5, stamped Year 2026 and the last version it carries. It applies where a High Court, a tribunal or an Adjudicating Authority under the Insolvency and Bankruptcy Code, 2016 makes an order in a business reorganisation and a return under section 139 had already been furnished for a year the order covers. The successor must then file a modified return within six months from the end of the month in which the order was issued, "in accordance with and limited to the said order". The machinery is rule 12AD and Form ITR-A, inserted by the Income-tax (Thirty-first Amendment) Rules, 2022 with effect from 1 November 2022, filed electronically under digital signature. Section 170A(2) then tells the assessing officer what to do: modify the total income already determined if the assessment is complete, or assess or reassess in accordance with the scheme if it is pending. What section 170A does not do is validate an order made on an entity that had already ceased to exist. It repairs your filings; it does not repair his order. The provision that does try to save the department is section 170(2A), also from the Finance Act 2022 and also in force from 1 April 2022. It deems an assessment, reassessment or other proceeding made or initiated on the predecessor "during the course of pendency of such succession" to have been made on the successor. Read the Explanation before you concede anything to it. Pendency starts when the application for the succession is filed before the High Court or tribunal, or when the insolvency application is admitted, and it ends on the date the order is received by the Principal Commissioner or the Commissioner — not the date of the order. A proceeding begun before that window opened, or continued after the Commissioner had the order in hand, is outside the sub-section, and you are back in Maruti Suzuki. Section 156A, from the same Finance Act, is narrower than its heading suggests: it lets the Assessing Officer modify a demand notice only where the sum demanded "is reduced as a result of an order of the Adjudicating Authority as defined in clause (1) of section 5 of the Insolvency and Bankruptcy Code, 2016". It does not reach a scheme sanctioned by a High Court or a tribunal, and it says nothing about a demand raised on an entity that had ceased to exist.
Section 292B is the department's standing answer and it has a hard edge. The text, inserted by the Taxation Laws (Amendment) Act 1975 with effect from 1 October 1975 and unchanged since, says that no return, assessment, notice, summons or other proceeding is invalid "merely by reason of any mistake, defect or omission" in it if it "is in substance and effect in conformity with or according to the intent and purpose of this Act". The line it cannot cross is the one between a defect in how a power was exercised and the absence of the power. A misdescribed section, a typographical slip in a name, a wrong assessment year in the heading where the body makes the year plain — those are defects. Directing a proceeding at a person who does not exist is not a defect in the proceeding; there is no proceeding, because there is no assessee. That is why Maruti Suzuki called it a substantive illegality. Sky Light Hospitality LLP v ACIT shows the other edge of the same blade: the Supreme Court dismissed the special leave petition on 6 April 2018, and Maruti Suzuki explained that decision as resting on its own facts, where the material showed the notice was meant for and reached the successor and "the wrong name given in the notice was merely a clerical error". Section 292BB is narrower still — it deems service good only where the assessee appeared or co-operated and raised no objection before the assessment was completed. In CIT v Laxman Das Khandelwal (Supreme Court, 13 August 2019, Civil Appeals Nos. 6261-6262 of 2019) the Court held that section 292BB "is not intended to cure complete absence of notice itself" and that "It is only the infirmities in the manner of service of notice that the Section seeks to cure".
The dead assessee is a different provision and a different fight. Section 159(1) makes the legal representative liable to pay what the deceased would have had to pay; section 159(3) deems him an assessee; section 159(6) caps the liability at what the estate can meet. The machinery is in section 159(2), and the two clauses do different work. Clause (a) deems a proceeding taken against the deceased before his death to have been taken against the legal representative, so it can be continued from the stage it had reached on the date of death. Clause (b) allows a proceeding that could have been taken against the deceased to be taken against the legal representative — taken against him, by name. So if nothing was on foot in the lifetime, a section 148 notice issued in the dead person's name is not a proceeding taken against anybody. In Savita Kapila v ACIT (Delhi High Court, 16 July 2020, W.P.(C) 3258/2020) the assessee died on 21 December 2018 and the notice issued on 31 March 2019 in his name; the Court held that issuing the notice in the name of the correct person "is not merely a procedural requirement but is a condition precedent", that section 159 had no application because nothing was pending in the lifetime, that there is no statutory duty on heirs to report the death or cancel the PAN, that section 292B does not apply because this is not a mistake, defect or omission, and that section 292BB "is applicable to an assessee and not to a legal representative". It also held that the assumption of jurisdiction over the heir outside the section 149 period was time-barred. Dharamraj v ITO (Delhi High Court, 17 January 2022, W.P.(C) 9227/2021) followed it and set aside the notice and everything after it. The Allahabad High Court took the same view in Asha Dubey v Union of India (Writ Tax No. 571 of 2026, delivered 21 July 2026, Shekhar B. Saraf and Abdhesh Kumar Chaudhary JJ). The assessee died on 7 January 2024 and the section 148 notice for assessment year 2021-22 issued on 28 March 2025 in his name. The Court's reasoning on section 159 runs through clause (a): that clause presupposes a proceeding validly initiated against the assessee in his lifetime, and where the notice itself is void there is nothing for it to continue. It also answered the argument the department falls back on when it loses: a decision quashing a notice issued to a dead person does not itself amount to a "finding" or "direction" within section 150(1), so the department cannot use the quashing order to reopen a year that section 149 has closed. The notice, the section 142(1) notice, the assessment order and the demand were all quashed, with no liberty to issue a fresh notice.
Where the High Courts part company is on what participation by the heir does, and on the remedy. Gujarat frames the enquiry around waiver: in Chandreshbhai Jayantibhai Patel v ITO [2019] 413 ITR 276, applied by the same Court in Krishnaawtar Kabra v ITO (C/SCA/1515/2022, 29 March 2022), the notice failed because the legal representative did not waive the requirement of notice and did not submit to the assessing officer's jurisdiction — there the heir objected and filed no return. On that framing an heir who files a return in answer to the notice and argues the merits without taking the objection can be held to have brought himself within section 159(2)(b). Delhi is firmer: on Savita Kapila and Dharamraj, section 292BB is not available against a legal representative at all and section 159 does not operate where nothing was pending in the lifetime, so participation cannot supply a jurisdiction that never existed. Nobody has resolved that difference. On remedy, most courts quash and leave the department to limitation — Delhi, Allahabad, Gujarat, and Madras in Alamelu Veerappan v ITO, which Savita Kapila followed. A 2026 Madras single-judge decision, Kandhasamy Amaravathy v ITO (W.P.(MD) No. 20203 of 2026, C. Saravanan J), went the other way on relief: instead of quashing outright it remitted the matter for a fresh notice on the legal representatives and excluded the intervening time from the section 149 computation. If you are acting for an heir, that is the order to argue against, because it hands the department back the limitation it had lost.
One thing has not happened, and it is worth knowing. The Finance Act 2026 (Act No. 4 of 2026, assented 30 March 2026) inserted two saving provisions into the 1961 Act, and both were given retrospective effect — the departmental footnotes read "w.r.e.f.", not "w.e.f.". Section 292BA, with retrospective effect from 1 October 2019, opens "Notwithstanding anything contained in any judgment, order or decree of any court" and provides that no assessment is invalid for a mistake, defect or omission in quoting a computer generated Document Identification Number — but only "if the assessment order is referenced by such number in any manner". That condition is the whole limit of the provision and it is the only part of it you can argue with: where no such number exists anywhere on the order, section 292BA does not engage. Section 292BC, with retrospective effect from 1 April 2021, deems approvals given in assessment, reassessment and recomputation proceedings to be administrative and supervisory and saves them from objections about insufficiency of reasons or defects in authentication. The same two rules went into the Income-tax Act, 2025 as sub-sections (2) and (3) of section 522. Parliament therefore looked squarely at technical invalidity in 2026 and legislated against it in two named areas. It did not touch assessments on amalgamated companies or on dead assessees. The argument on this page survives that Act intact. From tax year 2026-27 — the year beginning 1 April 2026, which is what the 2025 Act means by a tax year — the Income-tax Act, 2025 applies. Read that carefully, because it is not assessment year 2026-27: assessment year 2026-27 is the previous year ended 31 March 2026 and is still on the 1961 Act, as is every year before it. The provisions carry over under the department's own concordance: section 159 becomes section 302, section 170 becomes section 313 with the pendency deeming at section 313(3), section 170A becomes section 314, section 148 becomes section 280 and section 292B becomes section 522. The wording is recast but the scheme is the same, and nothing in the recast answers the question these cases decide. Almost all of this litigation still sits on the 1961 Act, and will for years.
This is a jurisdictional point, which means it is worth more than most of what you will argue. If it is good, the order goes entirely and the department has to start again against the right person within limitation — which, in a reassessment, it usually cannot. It is also the point most easily thrown away. Maruti Suzuki says participation is no estoppel where the entity is dead, but Mahagun Realtors shows what happens when the assessee's own conduct is what created the confusion: conceal the merger, file and litigate in the dissolved company's name, and the Court will let the assessment stand and send you back to fight on the numbers.
The two decisions are cited against each other every day in assessment proceedings, and both sides overstate. A reply that says "Maruti Suzuki makes this void" without dealing with Mahagun Realtors invites an order that distinguishes your case on facts you never addressed. An officer who says "Mahagun Realtors settles that this is curable" has read a headnote, not the judgment.
The only thing behind my reopening notice is the Valuation Officer's report. Is that enough?
My return was only processed under 143(1). Does that stop the department reopening it later?
The order under section 148A(d) rejects everything I said and the section 148 notice has followed. Can I take it straight to the High Court?
I made unexplained investments after the close of my accounting year. Which year can the officer tax them in, and can he reopen an earlier year to do it?
My land was notified and an award was made under the Land Acquisition Act, but I thought the award was too low, negotiated a higher figure and executed a sale deed. The Assessing Officer now says that was a voluntary sale and denies s.10(37). Is he right?
My client took his share on a partition and is now the only member — unmarried, no wife, no children. He wants to file as an HUF because the property he received is ancestral. Can he?
How much am I actually required to disclose — and can they reopen because the officer drew the wrong conclusion?
The family's only income-producing right is the karta's share in a managing agency, which cannot be split among the members. They divided the commission between themselves. Is that a partition the department must accept?
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