ITO WARD-14(3), NEW DELHI vs. KLM HOLDINGS PVT. LTD., NEW DELHI
Facts
During the appeal by the revenue, it was brought to the Tribunal's attention that the NCLT had initiated Corporate Insolvency Resolution Process (CIRP) against the assessee for default on a loan of Rs. 1.10 Crore. A moratorium under Section 14 of IBC, 2016, was in effect, prohibiting the continuation of pending proceedings against the assessee.
Held
The Tribunal, acknowledging the NCLT's moratorium, decided to consign the revenue's appeal to records. It granted liberty to the revenue to revive the appeal after the NCLT proceedings are completed, as the continuation of proceedings against the respondent is prohibited.
Key Issues
Can an Income Tax Appellate Tribunal appeal proceed against an assessee when the Corporate Insolvency Resolution Process (CIRP) has been initiated and a moratorium under IBC, 2016 is in place?
Sections Cited
Section 7 of IBC, 2016, Section 7(6) of IBC, 2016, Section 14 of IBC, 2016
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘C’: NEW DELHI
P a g e | 1 ITA No.8252/Del/2019 The ITO, Ward 14(3) Vs. M/s KLM Holdings Pvt. Ltd.
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘C’: NEW DELHI BEFORE,
SHRI G.S.PANNU, VICE PRESIDENT AND
MS. MADHUMITA ROY, JUDICIAL MEMBER ITA No.8252/Del/2019 (ASSESSMENT YEAR 2014-15)
The ITO Ward 14(3) M/s KLM Holdings Pvt. Room No. 305, 3rd Floor, Ltd. , 405, Ring Road C.R. Building, I.P. Estate Vs. Mall, Mangalam Place, Delhi - 110002 Sector-3, Rohini, PAN- AABCK8593Q New Delhi - 110085 (Appellant) (Respondent)
Appellant By Ms. Parul Singh, Adv. Respondent by Shri Abhu Dash Date of Hearing 27/06/2024 Date of Pronouncement 30/07/2024
ORDER PER MADHUMITA ROY, JM:
At the time of instant appeal, the ld. Counsel appearing for the assessee submitted before us that the National Company Law Tribunal, New Delhi Bench passed an order dated 06.12.2023 on a petition filed by BCL Enterprises Ltd. against the assessee under Section 7 of IBC, 2016 for default in repayment of loan sanction of
P a g e | 2 ITA No.8252/Del/2019 The ITO, Ward 14(3) Vs. M/s KLM Holdings Pvt. Ltd. Rs.1,10,00,000/- by the BCL Enterprises Ltd. to the assessee before us and the amount of the Corporate Debtors has been declared NPA w.e.f 04.07.2023 wherein the total due and payable of the Corporate Debtor to the said financial creditor of Rs.1,14,52,840/- as on 04.07.2023. By the said order the application has been admitted in view of the provision of Sec. 7(6) of IBC, 2016 and CIRP qua CD stood commenced. Further that in view of the moratorium as provided under Section 14 of IBC, 2016, the continuation of pending suits or proceedings against the respondent therein before any Court of Law/Tribunal/Arbitration Panel and other authority are prohibited.
Having regard to this particular aspect of the matter we, therefore, consign to records the appeal preferred by the revenue with liberty to revive the same upon making further application after the proceeding before the NCLT are completed, if so advised in law.
In the result, for the statistical purposes the appeal of the revenue is dismissed.
Order pronounced in the open court on 30.07.2024
Sd/- Sd/- (G.S.PANNU) (MS. MADHUMITA ROY) VICE PRESIDENT JUDICIAL MEMBER Dated: 30/07/2024 Rohit:
P a g e | 3 ITA No.8252/Del/2019 The ITO, Ward 14(3) Vs. M/s KLM Holdings Pvt. Ltd.
