Setback for Vedanta: Assessment Order is Valid Even though Notice under Section 148 was issued in a wrong name

M/S Vedanta Limited 

V/S 

Deputy Commissioner of Income-Tax   

W.P.No.25529 of 2015 

Issue  

Writ Petition filed questioning the legal validity of the notice issued under Section 148 of the Income Tax Act, 1961 and the consequential proceedings issued by the Deputy Commissioner of the Income Tax, in proceedings dated 06.08.2015, is also questioned mainly on the ground that the initiation was not made against any ‘person’, as contemplated under the provisions of the Act. 

Facts  

• Vedanta Limited, formerly known as M/s. Sterlite Industries which was incorporated on 25.06.1965.  
• M/s. Sterlite Industries (India) Limited filed Return of Income on 29.09.2008, for the Assessment Year 2008-2009.  
• M/s. Sterlite Industries (India) Limited has merged with M/s. Sesa Goa Limited, with effect from 17.08.2013. In terms of the scheme of amalgamation and the arrangement inter-alia between M/s. Sesa Goa Limited and M/s. Sterlite Industries (India) Limited, as sanctioned by the Hon’ble Bombay High Court, Goa Bench and Hon’ble Madras High Court, vide orders dated 03.05.2013 and 25.07.2013.  

• The notice was issued by the respondent under Section 148 of the Income Tax Act, to the principal officer M/s. Sesa Sterlite Industries (India) Limited No such company was in existence during the relevant point of time and at any point of time.  

Findings  

The notice under Section 148 was issued in a wrong name. However, close reading of the name of the Company would reveal that the first word ‘Sesa’ is not alien to the petitioner Company and the very same word is used by the petitioner subsequently. The said mistake was pointed out by the petitioner. The department issued a corrigendum, wherein again they have committed a mistake. The reason stated by the department is that the Company is having the habit of frequently changing their names as well as their registered office and the said conduct of the Company created confusion in the department and therefore, the mistake cannot be a ground to vitiate the entire proceedings. However, in the present case, the Assessing Officer has taken steps to correct the mistake and in letter dated 06.08.2015, the Deputy Commissioner of Income Tax, narrated the entire facts and circumstances for the mistake earlier committed by the department and thereafter, the proceedings were conducted in the correct name of the petitioner. 

Judgement  

This Court held that the mistake crept in at the initial stage was identified by the department and subsequently corrected and the proceedings thereafter were continued in the name of the petitioner, there is no reason to interfere with the process of reassessment already completed and it is for the petitioner to redress their grievances, if any exist, by preferring an appeal, in the manner prescribed under the Act. In fine, this Court do not find any infirmity or perversity as such, for the purpose of undoing the processes undertaken already, pursuant to the impugned notices issued under Section 148 of the Act and consequently, the Writ Petition stands dismissed.  

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