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2023 (3) TMI 508 - ITAT DELHIIncome Tax demands in view of the order passed by NCLT imposing moratorium in terms of section 14 of the IBC Code - Powers of AO in framing assessments as well as raising tax demand in the face of order passed by NCLT imposing moratorium under the provisions of Insolvency and Bankruptcy Code (IBC) - 2016 - HELD THAT:- As could be seen from the observations of the NCLT, debt due to various creditors, such as, unsecured financial creditors, operational creditors and other creditors, including Income Tax Department were extinguished and determined at Nil as per waterfall mechanism mentioned under section 53 of the IBC Code. This is clearly evident from List –B of the Report of the IRP and finds place at entry 47 of List-B appended to the final order of the NCLT in respect of income tax demand for various assessment years. At this stage, it is further necessary to observe, though, at the stage of CIRP before NCLT, AO had communicated to the IRP regarding the upward revision in tax demand relating to various assessment years starting from 2005-06 to 2014-15, however, the IRP declined to consider the revised demand of the AO as Insolvency Resolution Process period has ended. Thus, the aforesaid facts clearly reveal that the Income Tax demands relating to the assessee for assessment years 2005-06 to 2014-15 have been fully extinguished and reduced to Nil in the final order of the NCLT. Thus we quash the impugned assessment orders. Resultantly, the impugned orders of Commissioner (Appeals) are set aside.
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