ACIT, NEW DELHI vs. M/S. TECPRO SYSTEM LTD., GURGAON

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ITA 521/DEL/2017Status: DisposedITAT Delhi16 January 2026AY 2012-13Bench: SHRI YOGESH KUMAR US, JUDICIAL MEMBER, SHRI NAVEEN CHANDRA (Accountant Member)1 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 held that since the NCLT approved the Resolution Plan under the IBC, no parallel proceedings under the Income Tax Act could be undertaken. This decision was supported by precedents where the IBC was held to have an overriding effect over the IT Act, thus rendering IT proceedings unsustainable.

What were the facts?

The Revenue preferred two appeals against the order of the CIT(A) pertaining to AYs 2011-12 and 2012-13. The sole grievance in both appeals was the deletion of additions made by the AO on account of bogus expenses and undisclosed income. The National Company Law Tribunal (NCLT) had approved a Resolution Plan under the Insolvency and Bankruptcy Code, 2016 (IBC).

What were the issues?

Whether Income Tax Act proceedings can continue if the assessee is undergoing insolvency proceedings under the IBC and a Resolution Plan has been approved by the NCLT.

Which sections of the Income-tax Act were involved?

Section 31 of the Insolvency and Bankruptcy Code, 2016

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(2)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

Income Tax Appellate Tribunal, DELHI ‘F’ BENCH,

Before: SHRI YOGESH KUMAR US, & SHRI NAVEEN CHANDRA

For Respondent: Shri Amit Jain, CIT- DR
Hearing: 16.12.2025Pronounced: 16.01.2026

Heard together (2 matters)

ITA No. 520/DEL/2017
ITA No. 521/DEL/2017

Read from the judgment's own cause title. This page is filed under one of them.

PER NAVEEN CHANDRA, ACCOUNTANT MEMBER:- The above captioned two separate appeals by the Revenue are preferred against the order of the ld. CIT(A)-23, New Delhi dated 25.11.2016 pertaining to A.Ys. 2011-12 and 2012-13 respectively.

1.

ITA Nos. 520 & 521/DEL/2017 [A.Y 2011-12 & 2012-13] ACIT Vs. Tecpro Systems 2. None appeared on behalf of the assessee. We decided to proceed ex-parte with the assistance of the ld. DR who was heard at length. Case records carefully perused.

3.

The solitary grievance raised by the Revenue in both the appeals is the deletion of addition made by the Assessing Officer on account of bogus expenses claimed by the assessee company. In A.Y 2012-13, the Revenue has raised another ground pertaining to deletion of addition on account of undisclosed income.

4.

At the very outset, the ld. DR pointed out to the order of the National Company Law Tribunal [NCLT] delivered on 15.05.2019 wherein the NCLT has approved the Resolution Plan u/s 31 of the Insolvency and Bankruptcy Code, 2016 against the assessee.

5.

We have heard the submissions and have perused the relevant material on record. We find that the NCLT u/s 31 of the provisions of the Insolvency and Bankruptcy Code, 2016 (I & B Code], has approved the Resolution Plan. In such a situation, we are of the considered view that by virtue of the order of NCLT which accepted the application filed against the assessee for initiating proceedings under IBC, no parallel proceedings under Income Tax Act can be undertaken and therefore the appeal of the Revenue cannot survive.

Page 2 of 4 & 521/DEL/2017 [A.Y 2011-12 & 2012-13] ACIT Vs. Tecpro Systems 6. We are fortified in our observation by the decision of the Mumbai Bench of the Tribunal in the case of Pratibha Industries Ltd. Vs. DCIT (142 taxmann.com 295) taking note of the decision of the Hon’ble Apex Court in the case of Pr.CIT Vs. Monnet Ispat & Energy Ltd. (107 taxmann.com 481) wherein the Hon’ble Apex Court held that IBC has an overriding effect over the provisions of IT Act and dismissed the appeals of the Revenue as well as the Assessee as the proceedings under Insolvency and Bankruptcy Code 2016 were initiated on the assessee.

Therefore, the proceedings under I.T. Act in the case of assessee can no longer continue. Accordingly, the grounds of the Revenue in both the A.Ys are dismissed.

7.

The appeals filed by the Revenue however, are hereby dismissed with the liberty to the Revenue to file miscellaneous application for recall of this order once the assessee is declared that it is out of the purview of IBC proceedings under Insolvency and Bankruptcy Code 2016, as and when situation arises.

8.

In the result, appeals of the Revenue in and 521/DEL/2017 are dismissed.

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