ACIT Vs IL & FS Energy Development Company Limited (ITAT Delhi)
Summary: ITAT Delhi dismissed the Revenue’s appeals concerning IL & FS Energy Development Company Limited for AYs 2017-18 and 2018-19 in view of the moratorium-like protection granted by the National Company Law Appellate Tribunal. The assessee relied upon the NCLAT order dated 15.10.2018 in Company Appeal (AT) Nos. 346 & 347/2018, whereby the institution or continuation of suits or proceedings by any party against the assessee company or its group companies in any court of law, including a Tribunal, had been stayed.
The Assessing Officer, through the Departmental Representative, submitted that the appeals should consequently be kept in abeyance or adjourned sine die until the final outcome of proceedings before the NCLT. The Tribunal, however, considered that once moratorium had been granted, the Department could not succeed without first establishing its claim in the insolvency or liquidation proceedings. It observed that nothing had been placed before it to demonstrate that the Department had made any claim concerning the present assessee and the issues involved in the appeals.
The Tribunal therefore found no justification for keeping the appeals pending. Accordingly, the appeals were dismissed, while liberty was granted to seek restoration if any favourable order concerning the Department’s claim relating to the impugned assessment orders subsequently became available as a remedy enabling the Department to prosecute the appeals.
Cases Discussed
- Union of India v. Infrastructure Leasing & Financial Services Ltd. & Ors., Company Appeal (AT) Nos. 346 & 347 of 2018, order dated 15.10.2018 (NCLAT) — relied upon for the moratorium-like protection staying institution or continuation of suits or proceedings against IL&FS and its group companies; ITAT Delhi held that, without first establishing the Department’s claim in the insolvency or liquidation proceedings, keeping the Revenue’s appeals pending was not justified.
FULL TEXT OF THE ORDER OF ITAT DELHI
These appeals preferred by the assessee against the order dated 16.03.2024 of the Ld. National Faceless Appeal Centre (NFAC) Delhi (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) in DIN & Order No: ITBA/NFAC/S/250/2023-24/1062751720(1) arising out of the assessment order dated 27.04.2021 u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by the National e- Assessment Centre, Delhi for AYs: 2017-18 & 2018-19.
2. On hearing both sides we find that in regard to the present appeals of the department assesse has relied National Company Law Appellate Tribunal order dated 15.10.2018 in Company Appeal (AT) No. 346 & 347/2018 whereby moratorium like protection has been granted by staying the institution or continuation of suits or any proceedings by any party against the assesse company or its group company in any court of law including, Tribunal and based upon same assessing officer has filed a reply through ld. DR that the appeals be kept in abeyance or adjourned sine die till the final outcome of proceeding before NCLT.
3. We are of the considered view that once moratorium has been granted then without first establishing a claim in the insolvency or liquidation proceedings, the department cannot succeed and there is nothing before us to show that any claim of the department has been made with regard to present assesse and the issue therein involved. Keeping appeals pending is not justified.
4. Accordingly, the appeals are dismissed, with a liberty to get the appeals restored in case any favourable order with regard to claim of the department, in the impugned assessment orders involved, is available as a remedy to the department to prosecute the appeals.
Order pronounced in the open court on 24.06.2026.
