DEPUTY COMMISSIONER OF INCOME TAX, DELHI V. .KIXX MEDIA PRIVATE LIMITED, DELHI

ITA 3885/DEL/2024

AI Insights

The case involves an appeal by the Deputy Commissioner of Income Tax (Dy. CIT) against KIXX Media Pvt Ltd, challenging an order from the CIT(A) for the assessment year 2017-18. The primary legal issue was the applicability of the moratorium under the Insolvency and Bankruptcy Code, 2016, following the initiation of the Corporate Insolvency Resolution Process (CIRP) against KIXX Media Pvt Ltd by the National Company Law Tribunal (NCLT). The tribunal considered the impact of the CIRP on the ongoing tax recovery proceedings by the Revenue.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 470701 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2017-2018
• Other Referred Cases: M/Banyan Tree Natural Products Pvt Ltd Vs. KIXX Media Pvt Ltd
• Laws Referred To: Insolvency and Bankruptcy Code, 2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: OM PRAKASH
• Assessee Lawyers: SUNIL KUMAR
• Keywords: Liquidation

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘C’ BENCH, NEW DELHI BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT, AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA No. 3885/DEL/2024 [A.Y. 2017-18] The Dy. CI.T. Vs. KIXX Media Pvt Ltd Delhi B-26, Shivalik, Malviya Nagar New Delhi PAN – AAECK 7424 M (Applicant) (Respondent) Assessee By : Shri Sunil Kumar, Adv Department By : Shri Om Prakash, Sr. DR Date of Hearing : 03.12.2024 Date of Pronouncement : 18.12.2024 ORDER PER NAVEEN CHANDRA, ACCOUNTANT MEMBER:- This appeal by the Revenue is preferred against the order of the ld. CIT(A), New Delhi dated 23.08.2024 pertaining to A.Y. 2017-18. 2 2. At the very outset, the ld. counsel for the assessee submitted that Corporate Insolvency Resolution Process [CIRP] of KIXX Media Pvt. Ltd has commenced vide order dated 09.11l2023 of Hon'ble National Company Law Tribunal [NCLT], New Delhi. The ld. counsel for the assessee furnished a copy of the order of the NCLT in the matter of M/Banyan Tree Natural Products Pvt Ltd Vs. KIXX Media Pvt Ltd. 3. We have carefully perused the orders of the authorities below. At the very outset, we have to state that Corporate Insolvency Resolution Process [CIRP] has been initiated against KIXX Media Pvt Ltd under the provisions of the Insolvency and Bankruptcy Code, 2016 (I & B Code] w.e.f 09.11.2023 vide National Company Law Tribunal [NCLT] order in the case bearing No. IB-763(ND)/2022. 5. We are of the considered view that upon the commencement of CIRP, provisions of Moratorium as given u/s 14 of the I & B Code, 2016, came into force and the same read as under: 14. Moratorium – (1) Subject to provisions of sub-sections (2) and (3), on the insolvency commencement date, the Adjudicating Authority shall by order declare moratorium for prohibiting all of the following. namely: 3 (a) the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgement, decree or order in any court of law, tribunal, arbitration panel or other authority: (b) transferring, encumbering. alienating or disposing off by the corporate debtor any of its assets or any legal right or beneficial interest therein; (c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (54 of 2002); (d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. (4) The order of moratorium shall have effect from the date of such order till the completion of the corporate insolvency resolution process: Provided that where at any time during the corporate insolvency resolution process period. if the Adjudicating Authority approves the resolution plan under sub-section (1) of section 31 or passes an order for liquidation of corporate debtor under section 33. the moratorium ,>17([11 cease to have effect from the date of such approval or liquidation order, as the case may be.” 6. In line with the aforementioned provision, NCLT, in its order dated 24.11.2023 has directed the Registrar of Companies to update its website by updating the status of “Corporate Debtor”. 4 7. Considering the facts of the case in light of the judgment of NCLT [supra], we dismiss the appeal of the Revenue. 8. However, liberty is given to the Revenue to approach this Tribunal as per the provisions of the law pursuant to the final outcome of the proceedings under the I & B Code. 9. In the result, the appeal of the Revenue in ITA No. 3885/DEL/2024 is dismissed. The order is pronounced in the open court on 18.12.2024. Sd/- Sd/- [MAHAVIR SINGH] [NAVEEN CHANDRA] VICE PRESIDENT ACCOUNTANT MEMBER Dated: 18th DECEMBER, 2024. VL/ Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi 5 Date of dictation Date on which the typed draft is placed before the dictating Member Date on which the typed draft is placed before the Other Member Date on which the approved draft comes to the Sr.PS/PS Date on which the fair order is placed before the Dictating Member for pronouncement Date on which the fair order comes back to the Sr.PS/PS Date on which the final order is uploaded on the website of ITAT Date on which the file goes to the Bench Clerk Date on which the file goes to the Head Clerk The date on which the file goes to the Assistant Registrar for signature on the order Date of dispatch of the Order "