What did the Tribunal hold?

The Tribunal held that the Directors have no locus standi to file appeals once the CIRP has commenced. The appeals are not maintainable and are dismissed.

The assessee company is undergoing Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code, 2016. The appeals were filed by the Directors of the company.

What were the issues?

Whether appeals filed by Directors of a company undergoing CIRP are maintainable.

Metenere Ltd. vs ACIT | ITAT Delhi 2021

Income Tax Appellate Tribunal, [ DELHI BENCH “I–1”: NEW DELHI ]

Before: SHRI PRASHANT MAHARISHI & SHRI K.N.CHARY

For Appellant: Shri Anubhav Jaggi, C. A.;

For Respondent: Shri Surender Pal [CIT] – D. R.;

Hearing: 11/11/2021Pronounced: 11/11/2021

O R D E R PER BENCH :

These are bunch of five appeals for assessment years 2010-11 to 2014-15 filed by the assessee.

As on the date of hearing, an adjournment application was moved by the assessee. The reason stated is that this company is under the Corporate Insolvency Resolution Process and the State Bank of India has filed an application before the NCLT under Section 7 of Insolvency & Bankruptcy Code, 2016 and further Mr. Surender Raj Gang has been appointed as the Resolution Professional. The date of commencement of the insolvency is 25th September, 2020. 3. The ld. DR vehemently opposed the application for the adjournment and submitted that all these appeals have been filed by the Directors of the company which are not maintainable for the reason that now if these appeals are required to be prosecuted by the assessee, the Interim Resolution Professional should file the appeal, after obtaining the consent of Committee of Creditors. Page | 1

We have carefully considered the rival contentions. In the present cases, the insolvency process under IBC 2016 has commenced with effect from 25th September, 2020. As stated in the adjournment application still it is in progress. All these appeals have been found that those are filed by the Directors of the company. The moment IRP process starts in the case of a corporate debtor under IBC, 2016 the Directors do not have any locus standi. The Interim Resolution Professional is the only person, who can file the appeal and pursue the same. In these cases, all these appeals have been filed by the Directors and, therefore, these appeals are not maintainable. Therefore, we dismiss all these five appeals, but grant a liberty to the IRP to file these appeals, if the Committee of Creditors decides so. At that time, either he may file the fresh appeals with a request for condonation of delay or he may make an application for recall of this order.

In the result, all the five appeals are dismissed. Order pronounced in the open court on : 11/11/2021.

METENERE LTD.,DELHI vs. ACIT, CENTRAL CIRCLE- 17, NEW DELHI

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