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Facts
The assessee filed an appeal against the CIT(A)'s order for AY 2014-15 concerning disallowances of processing fees, freight, finance charges, and interest. During the hearing, it was brought to the Tribunal's attention that the assessee company had gone into liquidation under Section 33 of the Insolvency and Bankruptcy Code, 2016, following an NCLT order, and a liquidator had been appointed. This factual position was conceded by the Departmental Representative.
Held
The Tribunal held that, in light of the assessee's admitted liquidation under the I&B Code, the present appeal could not be proceeded with and was consequently dismissed. However, the Tribunal granted the assessee liberty to approach it for a recall of the order if the Liquidator later decides to pursue the appeal.
Key Issues
Whether a tax appeal filed by an assessee company can be proceeded with before the Income Tax Appellate Tribunal once the company has entered liquidation under the Insolvency and Bankruptcy Code, 2016.
Sections Cited
Income Tax Act, 1961 Section 143(3), Income Tax Act, 1961 Section 37, Income Tax Act, 1961 Section 234A, Income Tax Act, 1961 Section 234B, Income Tax Act, 1961 Section 234C, Income Tax Act, 1961 Section 234D, Insolvency and Bankruptcy Code, 2016 Section 10, Insolvency and Bankruptcy Code, 2016 Section 33, Insolvency and Bankruptcy Code, 2016 Section 33(5)
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Income Tax Appellate Tribunal, DELHI BENCH “G”: NEW DELHI
Before: SHRI KUL BHARAT & SHRI AVDHESH KUMAR MISHRA
1 ITA no. 6060/Del/2019 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “G”: NEW DELHI
BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI AVDHESH KUMAR MISHRA, ACCOUNTANT MEMBER
ITA No. 6060/DEL/2019 Assessment Year: 2014-15
SRS Modern Sales Ltd., Vs DCIT, Central circle-II, C/o SRS Mall, 3rd Floor, Faridabad. Sector-12, Faridabad-121007. PAN- AAKCS 6726 L APPELLANT RESPONDENT
Assessee represented by Shri Deepesh Garg, Adv. Department represented by Shri Anuj Garg, Sr. DR Date of hearing 21.05.2024 Date of pronouncement 28.05.2024
O R D E R PER KUL BHARAT, JM: This appeal, by the assessee, is directed against the order of the learned CIT (Appeals)-3, Gurgaon, dated 31.03.2019, pertaining to the assessment year 2014- 15. The assessee has raised following grounds of appeal:
“1) That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of the Ld. A.O. in framing the impugned assessment u / s 143(3) of the Income Tax Act, 1961 and in any view of the matter and in any case, the assessment framed by Ld. Assessing officer is bad in law and against the facts of the case. 2) That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of the Ld. A.O. in making disallowances of Rs.26,33,438/ on account of processing fees u / s
2 ITA no. 6060/Del/2019 37 of the Income Tax Act, 1961 and more so by alleging failure of the assessee to produce bills and vouchers. 3) That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the disallowance of processing fee of Rs. 26,33,438/- made in the assessment order is bad in law and against the facts and circumstances of the case. 4) That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of the Ld. A.O. in making disallowance of Freight charges of Rs. 2,87,887/- u/s 37 of the Income Tax Act, 1961 and more-so by alleging failure of the assessee to produce bills and vouchers. 5) That in any case and in any view of the matter, action of Ld. CIT(A) in confirming, the disallowance of Freight Charges of Rs.2,87,887/- made in the assessment order is bad in law and against the facts and circumstances of the case. 6) That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of the Ld. A.O. in making disallowance of Finance Charges of Rs. 12, 64, (960 / (- u)) / s, 37 of the Income Tax Act, 1961 Ltd. and more-so by alleging failure of the assessee to produce bills and vouchers 7) That in any case and in any view of the matter, action of Ld. CIT(A) in confirming, the disallowance of Finance Charges of Rs. 12,64,960/- made in the assessment order is bad in law and against the facts and circumstances of the case. 8) That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of the Ld. A.O. in charging interest u / s 234A, 234B, 234C & 234D, more so when such interest could not be levied under the law. 9) That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. A.O. in passing the impugned order without giving adequate opportunity of being heard and by not observing the principles of natural justice. 10) That the appellant craves the leave to add, alter or amend the grounds of appeal at any stage and all the grounds are without prejudice to each other.”
3 ITA no. 6060/Del/2019 2. At the outset learned counsel appearing on behalf of the assessee submitted that the assessee had filed petition being CP No. 10/Chd/Hry/2017, u/s 10 of the Insolvency and Bankruptcy (I&B) code, 2016, before the National Company Law Tribunal (NCLT) and in pursuance of order dated 26.02.2018 of the NCLT passed u/s 33 of the I&B Code the assessee has gone into liquidation. Learned counsel also submitted that in the said order the learned NCLT has also appointed liquidator. In support of his contention, the learned counsel has filed a copy of the order passed by the learned NCLT. Accordingly, learned counsel submitted that as per section 33(5) of the I&B Code, the present appeal cannot be proceeded and may be disposed of accordingly. Learned DR fairly conceded the aforesaid factual position.
Under the aforesaid admitted factual position, the present appeal filed by the assessee is dismissed with the liberty for approaching the Tribunal for recall of the order in the event Liquidator wishes to pursue the appeal. We order accordingly.
Appeal of the assessee is dismissed in terms, as indicated above. Order pronounced in open court on 28th May, 2024.
Sd/- Sd/- (AVDHESH KUMAR MISHRA) (KUL BHARAT) ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated: 28.05.2024. *MP* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI
4 ITA no. 6060/Del/2019