Lanco Solar Energy Private Limited, Hyderabad V. Asst. Commissioner of Income Tax, Circle-16(1), Hyderabad

ITA 1882/Hyd/2017

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 5303 (ITAT-HYDERABAD)
• Duration Of Justice: 4 year(s) 10 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-B
• Assessment Year: 2013-2014
• Appeal Filed On: 16-11-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Transfer pricing
• Section: 143(3); 13

Judgement Text

आयकर अपीलीय अधिकरण, हैदराबाद पीठ में IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B”, HYDERABAD BEFORE SHRI RAMA KANTA PANDA, ACCOUNTANT MEMBER & SHRI LALIET KUMAR, JUDICIAL MEMBER आ.अपी.सं / ITA Nos. निर्धारण वर्ा / A.Y. अपीलधर्थी / Appellant प्रत्‍यर्थी / Respondent 670/Hyd/2017 2012-13 M/s. Lanco Solar Energy Private Limited, Hyderabad [PAN: AABCL7372G] Asst. Commissioner of Income Tax, Circle-16(1), Hyderabad 1882/Hyd/2017 2013-14 निर्धाररती‍द्वधरध/Assessee by: Shri P. Murali Mohan Rao, AR रधजस्‍व‍द्वधरध/Revenue by: Shri Vijay Bhaskar Reddy, CIT-DR स ु िवधई‍की‍तधरीख/Date of hearing: 20/09/2022 घोर्णध‍की‍तधरीख/Pronouncement on: 20/09/2022 आदेश‍/ ORDER PER BENCH: Aggrieved by the order(s) passed by the Learned Asst. Commissioner of Income Tax, Circle-16(1), Hyderabad (“Ld. AO”) in the case of M/s. Lanco Solar Energy Pvt. Ltd., (“the assessee”) for the AYs.2012-13 & 2013-14, under section 143(3) r.w.s.92CA(3) & r.w.s. 144C(13) of the Income Tax Act, 1961 (for short “the Act”), consequent to the directions of Hon'ble Dispute Resolution Panel, Bengaluru (“DRP”), ITA Nos. 670/Hyd/2017 & 1882/Hyd/2017 Page 2 of 5 assessee filed these appeals. For the sake of convenience, we dispose-of these appeals by this common order. 2. At the outset it is represented by both the sides that the Corporate Insolvency Resolution Proceedings (CIRP) are initiated by admitting the application under section 7 of the Insolvency and Bankruptcy Code R/w Rule 4 of I&B (AAA) Rules, 2016 (“the Code”) by the National Company Law Appellate Tribunal (NCLAT) by order dated 14/06/2019. Learned DR submitted that the state of affairs obtaining as on today are not available and it is not known at what stage the CIRP are pending. Learned AR also submits that such facts are yet to be ascertained. 3. We have considered the issue in the light of the provisions of and the decision of the Hon'ble Apex Court in the case of Ghanashyam Mishra And Sons vs Edelweiss Asset Reconstruction (2021) 126 taxmann.com 132 (SC). Under section 13 of the Code, the adjudicating authority after admission of the application under section 7 or 9 or 10 of the Code shall declare a moratorium which shall include the prohibition of the institution of suits or continuation of pending suits or proceedings against the corporate debtor in any court of law or tribunal. In Ghanashyam Mishra And Sons (supra), it was held that, (i) That once a resolution plan is duly approved by the Adjudicating Authority under sub section (1) of Section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Government, any State Government or any local authority, guarantors and other stakeholders. On the date of approval of resolution plan by the Adjudicating Authority, ITA Nos. 670/Hyd/2017 & 1882/Hyd/2017 Page 3 of 5 all such claims, which are not a part of resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim, which is not part of the resolution plan; (ii) 2019 amendment to Section 31 of the I&B Code is clarificatory and declaratory in nature and therefore will be effective from the date on which I&B Code has come into effect; and (iii) Consequently all the dues including the statutory dues owed to the Central Government, any State Government or any local authority, if not part of the resolution plan, shall stand extinguished and no proceedings in respect of such dues for the period prior to the date on which the Adjudicating Authority grants its approval under Section 31 could be continued. 4. A reading of the provisions under section 13 and 14 of the Code along with the decision in Ghanashyam Mishra And Sons (supra), clearly shows that once the proceedings have commenced by institution of application under section 7 or 9 or 10 of the Code, the continuance of the pending proceedings is prohibited and when once they reach the logical conclusion with due approval of the resolution plan by the Adjudicating Authority under sub section (1) of Section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Government, any State Government or any local authority, guarantors and other stakeholders. 5. At any rate, for the time being, these appeals cannot be proceeded with during the continuance of the proceedings under the Code. Parties have to work out their remedies in the proceedings under the Code. ITA Nos. 670/Hyd/2017 & 1882/Hyd/2017 Page 4 of 5 However, depending upon the result of such proceedings before the adjudicating authority in respect of the corporate debtor, appropriate steps if any, may be taken by the appellant(s)/respondent(s). We, therefore, granting leave to the appellant(s)/respondent(s) in these appeals to seek the restoration of the appeals, if necessitated by the order in the Corporate Insolvency Resolution Proceedings, dismiss the appeals in limine. We derive support for the above proposition from the decision of the Mumbai Bench of the Tribunal in the case of Mahavir Roads & Infrastructure Pvt. Ltd., Vs. DCIT in ITA Nos. 646 to 651/Mum/2019 (AYs.2008-09 to 2013-14), dt.08/06/2022. 6. In the result, both the appeals are dismissed in limine. Order pronounced in the open court on this the 20 th day of September, 2022 Sd/- Sd/- (LALIET KUMAR) (RAMA KANTA PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated: 20/09/2022 TNMM ITA Nos. 670/Hyd/2017 & 1882/Hyd/2017 Page 5 of 5 Copy forwarded to: 1. M/s. Lanco Solar Energy Private Limited, C/o. P. Murali & Co., Chartered Accountants, 6-3-655/2/3, Somajiguda, Hyderabad. 2. Assistant Commissioner of Income Tax, Circle-16(1), Hyderabad. 3. The Dispute Resolution Panel (DRP), Bengaluru. 4. The Director of Income Tax (IT & TP), Hyderabad. 5. The Addl. Commissioner of Income Tax (Transfer Pricing), Hyderabad. 6. DR, ITAT, Hyderabad. 7. GUARD FILE TRUE COPY ASSISTANT REGISTRAR ITAT, HYDERABAD