DCIT, NEW DELHI vs. M/S. NIMITYA HOTELS & RESORT LTD., DELHI
Income Tax Appellate Tribunal, DELHI BENCH: ‘E’: NEW DELHI
Before: SHRI PRADIP KUMAR KEDIA & SHRI SUDHIR PAREEK
PER SUDHIR PAREEK, JM
These cross appeals filed by the Assessee (ITA No.-
1832/Del/2014) and Revenue (ITA No.- 1719/Del/2014) against the order dated 28.01.2014 of the Ld. Commissioner of Income Tax
(Appeals)-III, New Delhi, [hereinafter referred to as “Ld. CIT(A)”]
pertaining to Assessment Year 2009-10. The aforesaid cross appeals were earlier heard by the ITAT, and disposed of vide order dated
01.04.2019. Further vide Miscellaneous Application, the ITAT, recalled the aforesaid appeals vide order dated 10.10.2023, accordingly these appeals are listed and heard by us.
1.1 The Assessee has raised the following ground of appeal:
“ 1. That the learned CIT (Appeals) erred in law and on facts in observing and directing the AO to take action against the assessee for infringement of Sec 269SS of the I.T. Act, 1961, on the basis of an alleged document on the basis of which assessment was made by the AO and addition of Rs 3.50 Crores was made by the AO.
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That the Ld. CIT(Appeals) has exceeded his powers and juri iction in giving the directions to the AO to take action against assessee for infringement of Sec 269SS.
That CIT(Appeals) has grossly erred in law and on facts in holding that the assessee company has taken or accepted a loan from Sanjeev Mahajan of Rs 3.50 Crores
That the directions and observations of the CIT(Appeals) are illegal, bad in law and without juri iction and the same need to be expunged
The appellant craves leave to add to, alter, vary, modify or otherwise amend the grounds of appeal before the appeal is finally disposed of.
2 The Revenue has raised the following grounds of appeal: “ 1.On the facts and in the circumstances of the case, the CIT(A) has erred in deleting the addition of Rs. 3,50,00,000/- made by the A.O. on account of unexplained cash receipts by the assessee company outside the books of account.
2 On the facts and in the circumstances of the case, the CIT(A) has erred in holding that this cash received by the assessee company is a loan.
On the facts and in the circumstances of the case, the CIT(A) has erred in ignoring the fact that the amount of cash was given outside the books to Sh. Ram Mehar Garg, Director, to acquire controlling interest in the company which owns Hotel City Mart.
On the facts and in the circumstances of the case, the CIT(A) has erred in not appreciating the fact that the hotel was the property of the assessee company and the debentures were issued so as to convert them into equity shares and to pass the controlling interest of hotel to Sanjeev Mahajan's group concerns.
The order of the Ld. CIT (A) is erroneous and is not tenable on facts and in law.
The appellant craves leave to add, alter or amend any/all of the grounds of appeal before or during the course of the hearing of the appeal.”
ITA No.- 1719 and 1832/Del/2014
M/s Nimitya Hotels & Restorts Ltd.
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In the course of hearing, the Ld. AR submitted that the assessee has been referred for Insolvency and Bankruptcy proceedings and the petition for the same has been admitted by the National Company Law Tribunal (NCLT). It was further submitted that Insolvency Resolution Professional has been appointed by the National Company Law Tribunal, for taking over the charge of the company. The Ld. AR furnished on record a copy of order dated 24.12.2021 of National Company Law Tribunal in the case of Indian Bank (Erstwhile Allahabad Bank) vs. M/s Nimitaya Hotel (IB)-1913(ND)/2019, Court- II. of which relevant part is reproduced hereunder: “ 16. In the given facts and circumstances, the present Application being complete and having established the default in payment of the Financial Debt for the default amount being committed above the threshold limit, the present Petition is admitted in terms of Section 7(5) of the IBC and accordingly, moratorium is declared) in terms of Section 14 of the Code. As a necessary consequence of the moratorium in terms of Section 14(1) (a), (b), (c) & (d), the following prohibitions are imposed, which must be followed by all and sundry: "(a) The institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority; (b) Transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; (c) Any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002;
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(d) The recovery of any property by an owner or lessor, where such property is occupied by or in the possession of the corporate debtor."
17. As proposed by the Financial Creditor, this Bench appoints Mr.
Navneet Gupta as IRP having Registration No. IBBI/IPA-001/IP-
P00361/2017-18/10619 (Email:navguptaca@gmail.com), subject to the condition that no disciplinary proceedings are pending against the IRP so named and disclosures as required under IBBI Regulations, 2016 are made by him within a period of one week from this Order. This Adjudicating Authority orders that:
"Mr. Navneet Gupta, IRP having Registration No. IBBI/IPA 001/IP-
P00361/2017-18/10619,
(Email:
nav guptaca@gmail.com) is directed to take charge of the CIRP of the Corporate Debtor with immediate effect." "The Court Officer will inform the IRP so appointed by all modes."
The IRP is directed to take the steps as mandated specifically under Section 15, 17, 18, 20 and 21 of the IBC, 2016. 18. The Financial Creditor is directed to deposit Rs.2,00,000 (Two Lakh) only with the IRP to meet the immediate expenses. The amount, however, will be subject to adjustment by the Committee of Creditors as accounted for by Interim Resolution Professional and shall be paid back to the Financial Creditor.
19. A copy of this Order shall immediately be communicated to the Applicant/Financial Creditor, the Corporate Debtor and the IRP mentioned above by the Court Officer/Registry of this Tribunal.
20. In addition, a copy of the Order shall also be forwarded by the Registry to the IBBI for their records.”
In this context, the Ld. AR further submitted that in the aforesaid order dated 24.12.2021, the NCLT had, in accordance with relevant provision of Section 14 of the Insolvency and Bankruptcy Code, 2016, a moratorium had been declared and the continuation of any pending suit or proceedings against the corporate debtor i.e.
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the assessee in any Tribunal is barred and therefore, till the insolvency process continues, this appeal cannot be proceeded with.
4. Heard rival submissions and carefully perused the materials available on record. According to the provision of Section 14 of the Insolvency and Bankruptcy Code, 2016, the moratorium has been declared and the continuation of any pending suit is barred, as narrated above. So, in existing fact situation till the insolvency process continues, these appeals cannot be proceeded with. In view of this, till the company is revived in terms of the Income Tax Act,
1961 (“Act”, for short), this appeal need not be adjudicated presently.
In view of the foregoing, and as both sides have agreed to this at the time of hearing before us; we dismiss this appeal. However, before we leave, in the interest of justice, we give liberty to the assessee to file an application for revival of these appeals, if deemed fit, in accordance with law, as and when there is material change in facts and circumstances, such as when the moratorium period is over or when revival of the company takes place. Meanwhile, all the appeals filed by the assessee is dismissed.
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Consequently, both the appeals are dismissed. Order pronounced in the Open Court on 27.02.2025 (PRADIP KUMAR KEDIA) JUDICIAL MEMBER
Dated: 27/02/2025. Pooja/-