TATA STEEL BSL LTD (FORMERLY KNOWN AS BHUSHAN STEEL LTD.),NEW DELHI vs. DCIT, CENTRAL CIRCLE- 3, NEW DELHI

01.2025 घोषणाक' तार+ख/ Date of Pronouncement :

01.2025 PER DR. MITHA LAL MEENA, AM, These cross appeals by the Revenue as well as by the assessee are filed against the separate orders even dated 23.09.2019 of the learned Commissioner of Income Tax (Appeals)-23, New Delhi (hereinafter referred to as ‘the ld. CIT(A)), in respect of the Assessment Years 2014-15 and 2015-16 respectively. 2. At the outset, the ld. Counsel for the assessee submitted that Co- ordinate Bench of the Delhi Tribunal has granted relief in quantum appeal by restoring the matter in ITA Nos.1493 to 1495/Del/2018 and ITA No.4650/Del/2018, vide order dated 08.01.2025, and ITA Nos.1494 and 1495/Del/2018 for Assessment Year 2014-15 and 2015-16. The relevant part of the order is reproduced as under:- 5. We have heard the rival arguments and perused the material available on record. 6. Learned counsel for the assessee has submitted that since the National Company Law Tribunal (NCLT) is seized of the proceedings initiated under section 7 of the Insolvency and Bankruptcy Code, 2016 and has already approved a resolution plan and granted the moratorium in respect of any other proceedings pending before any authority or tribunal etc., the present appeals cannot be taken for further adjudication. She submitted that the appeals filed by the revenue against the assessee have been dismissed for the above assessment years, by this Tribunal vide order dated 14th June 2024. 7. In the written submission, she has stated that the claims of the Income Tax department were restricted to Rs 67,01,95,070/- as per the information memorandum and the resolution plan. Reliance has been placed on the ratio mentioned in the decision in the case of Ghanashyam Mishra & Sons (P). Ltd. vs. Edelweiss Asset Reconstruction Co. Ltd. [2021]126 taxmann.com 132 (SC). 8. Learned Departmental Representative for the Revenue could not convert the factual position brought on record by the assessee. He, thus submitted that the appeal cannot be decided on this juncture on merits and the Assessing Officer has to take necessary steps to include itself as secured creditor before the Hon’ble NCLT against the tax liability arising in the present case. We have also perused the submissions advanced by both sides in the light of relevant provision under the Act as well as IBC Code. Section 14 of IBC Code is very clear on the aspect that once moratorium is drawn and the insolvency commencement date is declared any institution of suits or definition of pending suits or proceedings against the creditor, debtor (in the present facts of the case of assessee before us) including the execution of any judgment, decree, or order in any Court of law, Tribunal, Arbitration Resolution Plan/Process has been accepted by the NCLT. At this juncture, we refer to the decision of Hon’ble Ltd. reported in (2021) 126 Taxmann.com 132 wherein the Hon’ble Supreme Court has considered a situation wherein, the resolution plan was approved by the adjudicating authority under Section 31(1) of the IBC Code. Hon’ble Supreme Court observed that, once the resolution plan was drawn, the claim as provided in the resolution plan stood frozen, and will be binding on the corporate debtor, its employee, its members, creditors, Central Government and any State Government or legal authority, guarantor and other stakeholders. We also note that in the present facts of the case, the resolution plan is yet to be finalized. When, we read the newly inserted provisions of Section 156A of the Act, it is necessary to remand the appeal to the Ld. AO to take necessary steps/action as per Rules. 9. Our above order applies mutatis mutandis to all the assessment years in appeal. 10. Hence, in the above circumstances, we deem it fit and proper to remand these appeals back to the Ld. Assessing Officer to take necessary steps as per Section 156A of the Act. Accordingly, we partly allow the appeals filed by the assessee. 11. In the result, the appeals of the assessee are allowed for statistical purpose.” 3. In our considered view, since the substratum of the penalty in cross appeals in respect of Assessment Years 2014-15 and 2015-16 has been eroded on account of quantum appeals are restored back to the file of the Assessing Officer for denovo assessment order, and hence the issue in the penalty appeal is rendered infructuous. Accordingly, appeals of the in respect of Assessment Years 2014-15 and 2015-16. 4. In the result, appeals of the Revenue as well as that of the assessee are dismissed.