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Facts
The Revenue filed an appeal against an order related to penalty proceedings under section 270A for AY 2018-19. The assessee company had been referred to the Insolvency Resolution Process under the IBC, and the NCLT had passed an order on 08/02/2021.
Held
As per the NCLT direction, no suit or legal proceeding can be initiated by or against the corporate debtor. Therefore, the appeal was dismissed, with liberty granted to the appellant/revenue to seek restoration.
Key Issues
Whether the appeal filed by the Revenue should be dismissed in light of the assessee's insolvency proceedings and NCLT order.
Sections Cited
270A, 250, 52
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘C’ BENCH
(Assessment Year :2018-19) Deputy Commissioner Vs. M/s.Pratibha Industries of Income Tax, Ltd., Central Circle, 3.1. 1B, 56 and 57 Room No.1923, 19th Phoenix Paragon Plaza Floor, Air India L B S Marg, Kurla West Building, Nariman Mumbai-400 070 Point Mumbai-400 021 PAN/GIR No.AAACP4709N (Appellant) .. (Respondent) Assessee by None Revenue by Shri R.A. Dhyani Date of Hearing 25/11/2024 Date of Pronouncement 26/11/2024 आदेश / O R D E R PER AMIT SHUKLA (J.M): The aforesaid appeal has been filed by the Revenue against order dated 18/12/2023 passed by CIT (A)-51 Mumbai in relation to the penalty proceedings u/s. 270A for the A.Y.2018- 19.
2. It has been brought to our notice that in the quantum proceedings, the appeal of the Revenue was dismissed by the M/s. Pratibha Industries Ltd ITAT on the ground that Assessee Company has been referred to Insolvency Resolution Process under IBC and NCLT has passed the order on 08/02/2021. As per the direction of NCLT, no suit or legal proceeding can be initiated by or against the Corporate debtor and accordingly, the appeal was dismissed with the liberty to the assessee / revenue to make an application for restoration of this appeal. For the sake of ready reference, the order of the Tribunal is reproduced hereunder:- “1.The revenue has filed the appeal against the order of the Commissioner of Income Tax (Appeals) (CIT(A)-51 Mumbai passed u/sec 250 of the Act.
At the time of hearing, the Ld. DR has mentioned that, the assessee has been referred to the Corporate Insolvency Resolution Process (CIRP) as per IBC-2016 Laws and is in liquidation process. Further the order passed by the National Company Law Tribunal (NCLT), Mumbai dated 08.02.2021 was brought on record, filed by the letter dated 9-07-2024.
3. We find that, subject to the provisions of Sec. 52 of IBC-2016, no suit or other legal proceedings shall be instituted by or against the corporate debtor. Considering the facts and circumstances, we are of the opinion that there is no point in proceeding with the appeal filed by the revenue and also keeping the appeal pending is also a continuation of proceedings.
4. Accordingly, we considering the order of the NCLT dismiss the appeal filed by the revenue. Further we grant the liberty to the appellant/revenue to make an application for restoration of this appeal by recall of this order.
In the result, the appeal filed by the revenue is dismissed.
Accordingly, the appeal of the Revenue in penalty proceedings is also dismissed on the similar line and we also grant same liberty to the assessee / revenue to make an M/s. Pratibha Industries Ltd application for restoration of this appeal as and when committee of creditors / NCLT authorizes the resolution professional to pursue the matter or the Income Tax department gets the permission from the Committee of Creditors or NCLT to pursue this appeal.
In the result, appeal of the Revenue is dismissed.
Order pronounced on 26th November, 2024.