V Hotels Limited Vs National Faceless Assessment Centre (Bombay High Court)
The Bombay High Court heard a writ petition in which the petitioner challenged two income tax notices issued for Assessment Year 2024–25. The impugned notices were issued under Sections 143(2) and 142(1) of the Income Tax Act by the National Faceless Assessment Centre. The petitioner argued that the notices were without jurisdiction because the company had undergone Corporate Insolvency Resolution Process (CIRP), and the Resolution Plan approved by the National Company Law Tribunal (NCLT) extinguished all claims relating to any period prior to its approval.
According to the petitioner, the CIRP began when the NCLT admitted an application under Section 7 of the Insolvency and Bankruptcy Code (IBC) on 31 May 2019, declared a moratorium under Section 14, and appointed a Resolution Professional. Although the NCLAT later set aside that order on 11 December 2019, the Supreme Court restored the NCLT’s 31 May 2019 order on 1 August 2022. Following restoration of the CIRP, the NCLT approved the Resolution Plan submitted by Macrotech Developers Limited on 26 April 2024 under Section 31 of the IBC.
The petitioner stated that the approved Resolution Plan provided for extinguishment or settlement of all claims and liabilities pertaining to any period before 26 April 2024. As a result, all proceedings, suits, and claims concerning the corporate debtor for any pre-plan period stood extinguished. After approval of the plan, the newly appointed Board of Directors filed the return of income for A.Y. 2024–25 solely to comply with Section 139(1) and to avoid being treated as a defaulter. Despite this, the tax authorities issued the impugned notices.
