ACIT, CIRCLE- 17(1), NEW DELHI vs. MONNET ISPAT & ENERGY LTD., NEW DELHI

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ITA 4027/DEL/2019Status: HeardITAT Delhi04 August 2022AY 2015-164 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal followed its previous decisions in the assessee's own case for earlier assessment years. It noted that the NCLT order leads to the extinguishment of liabilities owed to the Central Government.

What were the facts?

The revenue appealed against the CIT(A)'s order for AY 2015-16. The assessee argued that dues to the Central Government are operational debts under the IBC and are written off as per the NCLT-approved resolution plan.

What were the issues?

Whether liabilities owed to the Central Government are extinguished under an NCLT-approved resolution plan as per the IBC.

Which sections of the Income-tax Act were involved?

Section 5(21) of IBC

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘E’, NEW DELHI

Before: SH. N. K. BILLAIYA & SH. YOGESH KUMAR US

Hearing: 04/08/2022Pronounced: 04/08/2022

Appellant Sh. Vivek Sharma, CIT DR Respondent Sh. V. K. Jain, CA Date of hearing: 04/08/2022 Date of Pronouncement: 04/08/2022 ORDER

PER N.K. BILLAIYA, AM:

1.

This appeal by the revenue is preferred against the order of the CIT(A)-6, Delhi dated 18.02.2019 pertaining to A.Y.2015-16.

2.

The grievance of the revenue read as under :-

3.

At the very outset the Counsel for the assessee drew our attention to the decision of this Tribunal in assessee’s own case for A.Y.2013-14 and A.Y.2005-06 to 2007-08. It is the say of the Counsel that as per section 5 (21) of the IBC the dues to the Central Government also fall within the definition of operational debts and in terms of resolution plan as approved by the NCLT of the claims or demands or liabilities or obligations owned or payable to or assessed or assessable by the Central Government/ State Government in relation to any period or prior to the acquisition will be written off in full and will be deemed to be permanently extinguished. The counsel stated that pursuant to the order of the NCLT this Tribunal in earlier assessment years have dismissed the appeal of the revenue.

4.

Per contra the DR could not bring any distinguishing feature for the present appeal.

5.

We have carefully considered the orders of the authorities below and have also considered the decision of this Tribunal in for A.Y.2013-14 and ITA No.6961 to 6963/Del/2017 for A.Y.2005-06 to 2007-08. The relevant findings of the coordinate Bench read as under :-

6.

In the light of the above this appeal by the revenue is dismissed.

7.

Decision announced in the open court on 04.08.2022.

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