Case Law Details
V.S. MetaCast P.Lttd. Vs DCIT (ITAT Ahmedabad)
Proceeding under provisions of Insolvency and Bankruptcy Code, 2016 overrides the proceedings under the Income Tax Act, 1961. In other words, all the proceedings initiated or pending before different authorities shall stand abated in terms of approval of resolution plan by the NCLT. The Hon’ble Apex Court in judgment dated 13th April 2021 in the case of M/s. Gyanshyam Mishra and sons Private Limited -Vs- Edelweiss Asset Reconstruction Company Limited in Civil Appeal No. 8129 of 2019, was pleased to hold that once resolution plan is approved by the Adjudicating Authority under section 31 of IBC, the claims as provided in the Resolution Plan shall stand frozen and will be binding on the Corporate debtors and its employees, members, creditors, including Central Government and State Governments. It is further declared by the Hon’ble Supreme Court that all claims not part of the resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim, which is not part of the resolution plan.
The present appeal pertains to Asst.Year 2014-15 and the demand had arisen on 9.12.2016 pursuant to framing of assessment i.e. prior to the order dated 13.12.2021 passed by the NCLT. Further, as per the Resolution Plan, there is no claim made by the Income Tax Department before the Insolvency Professional. In the Resolution Plan approved by the NLCLT, an exgratia amount of Rs.10 lakhs only approved to the operational creditors being statutory creditors viz. CGST Department made a claim of Rs.11.70 crores and Asstt.Comm. of Sales Tax claimed Rs.1.77 crores. Therefore, we hold that the present appeal pending before the Tribunal is not sustainable in law in view of subsequent development narrated hereinabove.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This appeal is filed by the assessee against order dated 18.9.2017 passed by the Commissioner of Income-tax (Appeals)-8, Ahmedabad relating to the Asst.Year 2014-15.
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