2026-VIL-447-BOM
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SGST High Court Cases

GST - Demand against non-existent entity after merger - Petitioner was formed after the merger of Vodafone Mobile Services Ltd (VMSL) and Vodafone India Limited with Idea Cellular Limited as per an order of the National Company Law Tribunal. The GST authorities were duly informed about the merger at the time of amendment of the GST registration of Idea Cellular Limited - DGGI issued a show-cause notice to VMSL, even though VMSL had ceased to exist after the merger - Whether the DGGI had the jurisdiction to issue a show-cause notice and demand against the non-existent entity of VMSL after the merger – HELD - The principles laid down by the Supreme Court in Principal Commissioner of Income Tax, New Delhi v. Maruti Suzuki India Ltd. apply to the present case. Once the proper officer was duly informed about the merger and its legal consequences, namely that the amalgamating company VMSL had ceased to exist upon the approval of the scheme of amalgamation/merger, the officer lacked jurisdiction to issue the notice against VMSL. The proceedings against a non-existent entity are void ab initio – Further, the provisions of Section 87 of the CGST Act, relied upon by the respondents, are not applicable to the facts of the present case as the ingredients stipulated therein are not attracted. The Section 87 only preserves the transactions between the amalgamating companies during the intervening period from the date on which the order takes effect till the date of the order, and does not empower the Department to issue a show-cause notice on a non-existent entity post merger/amalgamation. Post-merger or amalgamation the merged entity has no status in the eyes of law, and therefore no proceedings can be initiated against it - The impugned show-cause notice issued against the non-existent entity is quashed – The writ petition is allowed
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