JAYBHARAT TEXTILES & REAL ESTATE LTD,MUMBAI vs. DCIT CC 5(3), MUMBAI

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ITA 6303/MUM/2018Status: DisposedITAT Mumbai24 January 2023AY 2012-133 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal noted that the assessee company was undergoing insolvency proceedings under the Insolvency and Bankruptcy Code, 2016. Consequently, the appeal was dismissed, with liberty to restore it after the moratorium period.

What were the facts?

The assessee company, engaged in textile manufacturing, filed its return declaring a loss. The Assessing Officer made additions and disallowances, leading to a revised loss and initiation of penalty proceedings under Section 271(1)(c). The penalty was confirmed by the CIT(A).

What were the issues?

The primary issue was the challenge to the penalty levied under Section 271(1)(c). The Tribunal also considered the impact of the assessee's insolvency proceedings on the appeal.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 144,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “F” BENCH, MUMBAI

Before: SHRI PRAKASH MAHARISHI, AM & MS. KAVITHA RAJAGOPAL, JM

For Respondent: Shri Yashwant Kumar Bhaskar
Hearing: 11.01.2023Pronounced: 24.01.2023

This appeal has been filed by the assessee, challenging the order of the learned Commissioner of Income Tax (Appeals)-53, Mumbai passed u/s.250 of the Income Tax Act, 1961 (‘the Act'), pertaining to the Assessment Year (‘A.Y.’ for short) 2012-13.

2.

Primarily, the assessee has challenged the penalty order u/s. 271(1)(c) of the Act dated 29.03.2018 passed by the Assessing Officer (A.O. for short) and confirmed by the ld. CIT(A).

3.

As there was no representation on behalf of the assessee, we proceed to hear and decide the appeal by hearing the ld. Departmental Representative (DR for short) and on perusal of the material available on record.

(A.Y. 2012-13) Jaybharat Textiles & Real Estate Ltd. vs. DCIT 4. The brief facts are that the assessee company is engaged in the business of manufacturing circular knitted hosiery, cloth, yarn and T.F.O. yarn. The assessee filed its return of income declaring total loss of Rs.29,61,68,590/- dated 27.09.2012. The assessee’s case was selected for scrutiny and the assessment order u/s. 144 of the Act was passed dated 31.03.2015, where the A.O. determined the total loss of the assessee at Rs.20,44,54,272/- by way of making various additions/disallowances. The penalty proceeding u/s. 271(1)(c) of the Act was initiated and the penalty amounting to Rs.3,46,82,710/- was levied.

5.

Aggrieved by this, the assessee was in appeal before the ld. CIT(A), challenging the penalty order dated 29.03.2018. The ld. CIT(A) upheld the penalty levied by the A.O.

6.

The assessee is in appeal before us, challenging the order of the ld. CIT(A).

7.

Having heard the ld. DR for the Revenue and perused the material available on record, it is observed that the assessee company is undergoing insolvency proceedings before the Hon’ble National Company Law Tribunal (NCLT for short) which is said to have appointed Interim Resolution Professional. The ld. DR had nothing to controvert the same.

8.

From the above observation, we are of the considered view that as per the provisions of section 14 of Insolvency and Bankruptcy Code, 2016, the assessee company is undergoing insolvency proceedings. We are, therefore, inclined to dismiss this appeal with the liberty given to the assessee to restore the same after completion of the moratorium period.

(A.Y. 2012-13) Jaybharat Textiles & Real Estate Ltd. vs. DCIT 9. In the result, the appeal filed by the assessee is dismissed.

Order pronounced in the open court on 24.01.2023 Sd/- Sd/- (Prashant Maharishi) (Kavitha Rajagopal) Accountant Member Judicial Member Mumbai; Dated : 24.01.2023 Roshani, Sr. PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. The CIT(A) 4. CIT - concerned 5. DR, ITAT, Mumbai 6. Guard File BY ORDER,

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