Case Law Details
MSP Metallics Limited Vs ACIT (Calcutta High Court)
Sub- Whether when Corporate Insolvency Resolution Plan(CIRP) is initiated against an entity, the income tax department can initiate fresh proceeding either civil or criminal and the pending proceeding is required to be stayed in view of Section 238 of the IBC.
The Calcutta high court in this case was dealing with a case where the petitioner while being subjected to CIRP under the IBC law was issued order u/s 148A(d) and subsequent proceedings were continued. However, the Ld Single Bench noting the legal position as laid down under Section 238 of IBC Law quashed the order u/s 148A(d) and all subsequent proceedings in view of the law that once CIRP is initiated, no fresh proceedings either civil or criminal can be initiated.
The pending proceeding is required to be stayed in view of Section 238 of the IBC, the provisions of IBC has overriding effect upon all other laws inconsistent therewith.
This judgement will be helpful in all cases where the department is going against the provisions of Section 238 of IBC Law even though the issue is settled in the case of Ghanshyam Mishra and other cases.
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