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Facts
The assessee filed an appeal against an order by the CIT(A) for the assessment year 2018-19. The primary issue revolves around the addition made by the Assessing Officer (AO) to the assessee's total income, significantly increasing it from the returned income. The assessee also contested interest charges and penalty proceedings initiated by the AO.
Held
The Tribunal held that the assessee's company had been admitted to the Corporate Insolvency Resolution Process under the IBC, 2016. As per Section 14 of the IBC, a moratorium is declared, prohibiting legal proceedings. Therefore, the appeal was rendered infructuous.
Key Issues
Whether the appeal is infructuous due to the company being under Corporate Insolvency Resolution Process and the moratorium declared under the IBC.
Sections Cited
143(3), 234A, 234B, 234C, 270A, 9(5), 14
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AHMEDABAD “A” BENCH, AHMEDABAD
Before: DR. BRR KUMAR & Ms. SUCHITRA KAMBLE
PER SUCHITRA KAMBLE, JUDICIAL MEMBER:
This appeal is filed by the Assessee against order dated 12.12.2023 passed by the CIT(A), National Faceless Appeal Centre (NFAC), Delhi for the Assessment Year 2018-19.
The assessee has raised the following grounds of appeal:
“1. The learned AO has erred in computing the total income that of Rs.15,74,45,440/- as against that of income returned Rs.76.85,440/- by disallowing and making addition of Rs.14,97,60,000/- considering the assessee’s claim as not acceptable.
Assessment Year: 2018-19 Omshri Devprocon Limited vs. DCIT Page 2 of 3 2. In law and in fact and circumstances of the appellant's case the learned AO has grossly erred in charging interest under section 234A/B/C/ of the Income Tax Act, 1961.
3. The learned AO is not justified in initiating penalty proceedings under section 270A of The Income Tax Act, 1961 with respect to above addition.
4. That the appellant prays to stay demand of Rs.7,79,32,510/- made by learned AO for the year under consideration.
The appellant has preferred an appeal to the CIT(A) against the order passed u/s.143(3). The learned CIT(A) dismissed the appeal The appellant has preferred further appeal to the ITAT for the above- mentioned grounds Note: Application of the company is admitted to Corporate Insolvency Resolution Process under section 9(5) of the IBC Act, 2016 as per order passed on 04.08.2022 by NCLT, Ahmedabad bench”
The ground of appeal taken by the assessee categorically mentions that the application of the Company is admitted to Corporate Insolvency Resolution Process under Section 9(5) of the Insolvency & Bankruptcy Code (IBC), 2016, as per order passed on 04.08.2022 by the NCLT Ahmedabad Bench. Thus, in the light of this, as per Section 14 of the Insolvency & Bankruptcy Code, 2016, adjudicating authority shall by an order declared moratorium for prohibiting the institutions of suits transferring or disposing by Corporate Debtor of its assets, an action to foreclose, recover or enforce any security and the recovery of any property by an owner which include statutory dues owned to the Central Government or State Government and if not part of resolution plan stands extinguished. Thus, in the light of this, the appeal becomes infructuous and hence the appeal of the assessee is dismissed.
In the result appeal of the assessee is dismissed.
Order pronounced in the open Court on this 12th March, 2025.