PCIT Vs EMC Limited (Supreme Court of India)
The Supreme Court of India disposed of the Special Leave Petition filed by the Revenue after taking note of subsequent developments relating to the liquidation proceedings of the assessee-company under the Insolvency and Bankruptcy Code, 2016, while leaving intact the substantive findings of the Calcutta High Court on the taxability of retention money.
Read HC Judgment: Retention Money Taxable Only After Right to Receive Crystallises: Calcutta HC
Before the Supreme Court, it was brought to notice that the National Company Law Tribunal, Calcutta Bench, had passed orders closing the liquidation process of the assessee-company. The liquidator had completed liquidation in accordance with the Insolvency and Bankruptcy Code and its regulations, sold the company as a going concern through e-auction, realised the entire sale consideration, and distributed proceeds to stakeholders as per section 53 of the Code. The NCLT recorded that all assets stood liquidated, compliance requirements were fulfilled, and the liquidation process could be closed. A corrigendum clarified that since the company was sold as a going concern, the liquidation process was closed rather than the corporate debtor being dissolved. Taking note of these developments, the Supreme Court found no reason to examine the Special Leave Petition on merits and disposed of it accordingly.
