ACIT, NEW DELHI vs. M/S. BHUSHAN STEEL LTD., NEW DELHI

While Revenue’s appeals are challenging the decision of learned Commissioner (Appeals) in granting relief to the assessee in the matter of various additions made by the Assessing Officer, in the cross objections, the assessee has raised a preliminary issue of maintainability of the present appeals of the Revenue.

We have heard Shri Ashwani Kumar, Advocate, learned counsel appearing for the assessee and Shri Rajesh Kumar, learned CIT-DR.

Learned counsel for the assessee has contended before us 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 moratorium in respect of any other proceedings pending before any authority or Tribunal etc., the present appeals cannot continue. He submitted, under similar circumstances, appeal filed by the Department in case of M/s. Bhushan Energy Ltd., another group entity, has been dismissed by the Tribunal. In this context, he placed on record order dated 17.04.2023 passed in and C.O. No. 159/Del/2019. Thus, he submitted, the appeals of the department have to be dismissed.

Learned Departmental Representative could not controvert the factual position brought on record by the assessee.

Having considered rival submissions and perused materials on record, we find that certain financial creditors have filed applications under Insolvency and Bankruptcy Code, 2016 before NCLT seeking initiation of corporate insolvency resolution process (CIRP). It is observed, NCLT has passed an order on 15.05.2018 approving the resolution plan/process. Thus, in terms with the order passed by NCLT, the present proceedings before the Tribunal cannot continue. That being the position in law, no useful purpose is going to be served in continuing the present proceedings. Therefore, in our considered opinion, the present appeals need to be consigned to the records.

In view of the aforesaid, we dismiss these appeals. However, liberty is granted to the Revenue to seek revival of the appeals in case order of NCLT is either reversed or modified or varied by any higher judicial forum or, if it is necessary to do so in the interest of the parties.

In the result, Revenue’s appeals are dismissed and cross objections are allowed.