GRAND VENEZIA COMMERCIAL TOWERS PVT. LTD.,NEW DELHI vs. ACIT(CENTRAL CIRCLE)- 2, NEW DELHI

PER BENCH: 1. The appeal in ITA No.486/Del/2017 for AY 2012-13 and 3817/Del/2017 for AY 2013-14, arises out of the ld. Commissioner of Income Tax (Appeals)-23, Delhi [hereinafter referred to as ‘ld. CIT(A)’, in short] dated 16.11.2016 for AY 2012-13 and dated 30.03.2017 for AY 2013-14 against the order of assessment passed u/s 153C/143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 30.03.2015 by the Assessing Officer, ACIT, Central Circle-2, New Delhi (hereinafter referred to as ‘ld. AO’). 2. At the outset, the ld AR placed on record the order passed by the Hon’ble National Company Law Tribunal (NCLT) in Company Petition IB (IBC) No. 646/PB/2021 dated 4-12-2023 wherein a moratorium has been declared in terms

ITA Nos. 486 &3817/Del/2017
M/s. Grand Venezia commercial Towers Pvt. Ltd of section 14 of the Insolvency & Bankruptcy Code, 2016 (IBC 2016).
Consequently any pending proceedings against the assessee, either at the behest of the assessee or by the income tax department cannot continue. The ld DR before us submitted that the appeal of the revenue cannot be dismissed in view of the provisions of section 14 of the IBC 2016 with respect to the moratorium period. The ld DR referred to the provisions of Rule 26 of ITAT
Rules, 1963 and stated that if income tax proceedings fall within the ambit of section 14 of IBC 2016, it will create an anomalous and paradoxical situation and accordingly submitted that the income tax proceedings could continue during the moratorium period also. The ld DR submitted that only the tax recovery proceedings shall not continue but the appeal proceedings could continue.
3. We are unable to comprehend ourselves to accept to this contention of the ld DR in view of the fact that the provisions of section 14 of the IBC 2016
provides that all the suits or continuation of pending suits or proceedings against a corporate debtor including any judgment or decree or order in any court of law, tribunal, arbitration panel or other authority cannot be passed during the moratorium period. The period of moratorium shall have the effect from the date of such order till the completion of the corporate insolvency resolution process. In the present case, the appeal filed by the assessee as well as by the revenue is an institution of suit against the corporate debtor (i.e. the assessee herein), which is prohibited under section 14 of the IBC 2016. The Hon’ble
ITA Nos. 486 &3817/Del/2017
M/s. Grand Venezia commercial Towers Pvt. Ltd
Further, the Hon’ble Supreme Court in the case of PCIT vs Monnet Ispat and Energy Limited in SLP(C ) No. 6487 of 2018 dated 10-08-2018 had upheld overriding nature and supremacy of the provisions of IBC 2016 over any other enactment in case of conflicting provisions by virtue of a non-obstante clause contained in section 238 of the IBC 2016. 4. In view of these overriding provisions of IBC 2016 and the decisions of the Hon’ble Supreme Court referred supra, the appeal filed by the assessee as well as by the revenue cannot be allowed to be continued during the moratorium period. Further, any resolution plan or liquidation order, if any, as decided by the competent authority would be binding on all the stakeholders including the Central Government, State Government or any local authority to whom a debt in respect of the payment of the dues may be owed. Accordingly, this will prevent state authorities, regulatory bodies including tax departments (both direct and indirect) from questioning the resolution plan or liquidation order as well as juri iction of tribunals with regard to IBC.
5. In the result, the appeal of the assessee is dismissed and appeal of the revenue is dismissed.

Order pronounced in the open court on 03/07/2025. - - (VIKAS AWASTHY)
ACCOUNTANT MEMBER

Dated: 03/07/2025
A K Keot