Care Office Equipment Limited Vs PCIT (ITAT Ahmedabad)
ITAT Ahmedabad held that invocation of Revision proceedings under section 263 of the Income Tax Act after approval of the Resolution Plan by NCLT is against the Provisions of Law. Accordingly, revisionary proceedings quashed.
Facts- The assessee is a Company engaged in the business of sale of Computer Hardwares service provides of Bar Code Stickers, Equipments and Printers. For the Asst. Year 2018-19, assessee filed its Return of Income on 30-10-2018 claiming a loss of Rs. 33,88,77,148. The return was processed u/s. 143(1) and then taken for scrutiny assessment. When notice u/s. 142(1) dated 29-03-2019 and others were issued, the assessee failed to response to the notices but ultimately on 01-02-2021 a letter was received from Insolvency Resolution Professional (IRP). Shri Vikash Gautamohand Jain that National Company Law Tribunal vide its order dated 29-05-2019 passed an order for commencement of Corporate Insolvency Resolution Process (CIRP). As per Section 14(1) of Insolvency and Bankruptcy Code, 2016 (IBC) the order of moratorium shall have effect from the date of such order till the completion of CIRP. Therefore IRP requested the A.O. not to proceed with the assessment further. However the AO sent one more notice U/s. 142(1) notice to the IRP and completed the assessment. AO made adhoc disallowance at 25% of the above expenses namely Rs.14,80,12,245/- is being disallowed as not extended for the purpose of business activity and determined the loss as Rs.19,08,64,903/-.
