CHARANBIR SINGH SETHI,GURGAON V. ACIT, CENTRAL CIRCLE-19, NEW DELHI

ITA 2752/DEL/2025

AI Insights

The case involves Charanbir Singh Sethi, who appealed against the order passed by the CIT(A)-27, Delhi, concerning the assessment year 2012-13. The primary contention was the enforceability of the income tax department's claims post the NCLT's discharge order dated 15.12.2025, which released the assessee from all debts and liabilities under the approved repayment plan. The Tribunal referenced a coordinate bench's earlier decision in the assessee's own case, which supported the view that the income tax department's claims were non-est and unenforceable following the NCLT's discharge order.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 846881 (ITAT-NEW DELHI)
• Duration Of Justice: 11 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-03-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Delhi
• Assessment Year: 2012-2013
• Appeal Filed On: 25-04-2025
• Other Referred Cases: JEKPL Private Limited Versus DCIT, Circle-13(l), Delhi, Ghanashyam Mishra & Sons (P) Ltd. Vs. Edelweiss Asset Reconstruction Co. Ltd., Sundaresh Bhatt vs Central Board Of Indirect Taxes And Customs
• Laws Referred To: Income Tax Act, 1961, Insolvency and Bankruptcy Code (IBC)
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR DHANESTA
• Assessee Lawyers: AMARJIT SINGH
• Section: 68

Judgement Text

"ITA No.2752/Del/2025 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B”NEW DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER AND SHRISANJAY AWASTHI, ACCOUNTANT MEMBER आ.अ.सं/.I.T.A No.2752/Del/2025 िनधा रणवष /Assessment Year:2012-13 CHARANBIR SINGH SETHI, AR-717, THE ARALIAS, DLF GOLF LINKS, Gurgaon, HARYANA 122009 PAN No.AASPS9437K बनाम Vs. ACIT, Central Circle-19, ARA Centre, Jhandewalan, New Delhi. अपीलाथ\u0014 Appellant \u0016\u0017यथ\u0014/Respondent Assessee by Shri Amarjit Singh, CA Revenue by Shri Rajesh Kumar Dhanesta, Sr. DR सुनवाईक\bतारीख/ Date of hearing: 23.03.2026 उ\u000eोषणाक\bतारीख/Pronouncement on 25.03.2026 आदेश /O R D E R PER SANJAY AWASTHI, ACCOUNTANT MEMBER: 1. This appeal arises from order dated 27.02.2025, passed u/s 250 of the Income Tax Act, 1961 (hereafter as “the Act”) by Ld. CIT(A)-27, Delhi. 1.1 In this case, right at the outset, the Ld. AR pointed out that the assessee was part of proceedings before NCLT, where he was discharged of all liabilities as a Personal Guarantor (PG) vide NCLT’s order dated 15.12.2025. The Ld. AR read out from page 15 of the said order and brought to our attention the findings in para 33 of this order, where the Printed from counselvise.com ITA No.2752/Del/2025 2 assessee has been discharged from all debts and liabilities mentioned in and settled under the repayment plan approved by the NCLT. The Ld. AR also placed on record an order of coordinate bench in assessee’s own case [ITA 2774/Del/2025, order dated 13.02.2026]. Through this order it was pointed out that the following findings would be relevant for deciding the issue at hand: “4. We find no force in the contention of ld. DR as admittedly department has not made any claim in the proceeding under the IBC. The discharge orders categorically mentions that the personal guarantor stand discharged from all debts and liabilities mentioned and settled under the repayment plan approved by NCLT. The repayment plan mentions of notices being issued u/s 102(2) of IBC inviting claim from creditors, which includes claims of Government also, wherein the last date of submission of claim was notified as 04.06.2024 in case of both the assessee. The list of claim by creditors is part of the repayment plan and we find there is claim of banks and financial institutions. There is claim of Government through Assistant Commissioner of Customs & EPFO. However, there is no claim of the income tax department and thus, in the absence of filing any claim, the discharge order attained finality and consequently, the claim of department becomes redundant. As for aforesaid principles reliance is placed on the decision in JEKPL Private Limited Versus DCIT, Circle-13(l), Delhi ITA No.759/Del/2022 order dated 17.1.2025, in which one of us, the judicial member was also in quorum, and the Coordinate Bench after considering decision of Hon’ble Supreme Court in Ghanashyam Mishra & Sons (P) Ltd. Vs. EdelweissAsset Reconstruction Co. Ltd., (2021) 9 SCC 657 and Hon’ble Supreme Court in Case of Sundaresh Bhatt vs Central Board Of Indirect Taxes And Customs (CIVIL APPEAL No. 7667 of 2021) had held as follows: ………. “8. In the present case, as described above, the admitted factual matrix is that the notices and orders impugned in these writ petitions pertain to the income tax claims of the respondents/revenue pertaining to the period much prior to the date of approval of the Resolution Plan. The impugned notices and orders were issued by the respondents/revenue admittedly subsequent to the public announcement under section 15 of the Code regarding CIRP process pertaining to the petitioner/assessee. Printed from counselvise.com ITA No.2752/Del/2025 3 As noted above, pertaining to the WP(C) 10528/2022, the public announcement u/s 15 of the Code called for submission of claims by 21.01.2019, but the respondents/revenue did not file any claim till that date or even thereafter; it is only subsequent to approval of the Resolution Plan vide order dated 05.11.2019 of the Tribunal, (which order was communicated to respondents/revenue on 02.12.2019) that the respondents/revenue issued the impugned Assessment Order and Demand Notice both dated 12.12.2019. Similarly, in the other writ petition WP(C) 10628/2022, the impugned notices and orders were issued by the respondents/revenue much subsequent to the public announcement dated 30.09.2019 of commencement of CIRP under Section 13 of the Code; vide order dated 21.02.2022, the Tribunal approved the final Resolution Plan and that order was communicated by the petitioner/ assessee to the respondents/revenue, calling upon the latter to withdraw the earlier notices, but to no avail. 9. In nutshell, the Resolution Plans qua the petitioners/assessees having been approved by the National Company Law Tribunal on 05.11.2019 (in WP(C) 10528/2022) and on 21.02.2022 (in WP(C) 10628/2022), the tax claims pertaining to the AY 2017-18 (in WP(C) 10528/2022) and AY 2014-15 (in WP(C) 10628/2022) stood extinguished. 10. The argument on behalf of respondents/revenue that being the State exchequer, it cannot be bound by the Resolution Process provisions of the Code has been recorded only to be rejected in view of the above quoted extract from the judgment in the case of Ghanshyam Mishra (supra).” 29. As a consequence of the aforesaid, we are inclined to hold that the assessment order may be valid so far as authority of Id. AO to conclude assessment is concerned. However, the same being not enforceable after 04.02.2020, it is non est and no recovery can be effected under the impugned assessment order subsequent to approval of resolution plan. Thus we sustain grounds no. 2.1, 2.2 and 2.3. As we hold that the claim of department under the impugned assessment is non est and unenforceable, the remaining grounds on merits become academic and need no formal adjudication further.” 4. In the light of aforesaid we hold that the claim of department under theimpugned assessment stands non-est and unenforceable. The appeals areallowed for statistical purposes.” 1.2 It is seen that the assessee has otherwise also challenged the additions made u/s 68 by the Ld. AO. Printed from counselvise.com ITA No.2752/Del/2025 4 2. The ld. DR placed on record a report from the Ld. AO dated 23.03.2026. Through this report the Ld. AO has supported the findings of authorities below regarding the merit of the additions made u/s 68 of the Act. However, no report has been submitted on the claim of the assessee regarding his discharge as a PG by the NCLT. 3. We have considered the arguments of Ld. AR/DR and we have perused the records before us. We find that the issue deserves to be decided in favour of the assessee on the basis of findings given in his own case, before ITAT, for AY 2013-14 (supra). Thus, it deserves to be held that the assessment order is not enforceable after the NCLT’s order in the assessee’s own case. Accordingly, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 25.03.2026 Sd/- Sd/- (CHALLA NAGENDRA PRASAD) (SANJAY AWASTHI) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 25.03.2026 *Kavita Arora, Sr. P.S. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "