ITO-13(3)(3), MUMBAI V. M/S. TOPSGROUP ELECTRONIC SYSTEMS LTD., MUMBAI

MA 503/MUM/2023

AI Insights

This case involves a miscellaneous application filed by the Income Tax Officer against M/s Topsgroup Electronic System Ltd concerning an appeal dismissed by the coordinate bench due to the company's admission into the Corporate Insolvency Resolution Process under the IBC 2016. The application sought to correct the assessment year mentioned in the original order and to keep the appeal pending instead of dismissing it, allowing for potential future proceedings. The tribunal corrected the assessment year but upheld the dismissal of the appeal, emphasizing the protection granted to the corporate debtor under the IBC during the moratorium period.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 299669 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 2 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 10-09-2023
• Appeal Filed By: Department
• Order Result: PartlyAllowed
• Bench Allotted: J
• Next Hearing Date: 24-08-2023
• Assessment Year: misc
• Appeal Filed On: 07-08-2023
• Laws Referred To: Insolvency and Bankruptcy Code 2016
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “J” BENCH, MUMBAI BEFORE SHRI PRASHANT MAHARISHI, AM AND SHRI RAHUL CHAUDHARY, JM MA No. 503/Mum/2023 Arising out of ITA 732/Mum/2019 (Assessment Year 2013-14) Incom e T ax Of f icer W ard 13(3)(3 ) Room No.216-B , 2 nd F loor, Aaykar Bha van M.K. Road, Mum bai-400 020 Vs. M/s Topsgroup Electronic System Ltd. 5,Royal Palms, Golf & Country Club, Survey No.169, Aarey Mill Road, Goregaon (East) Mumbai-400 065 (Applicant) (Respondent) PAN No. ALAPK2218D Assessee by : None Revenue by : Shri Manoj Kumar Sinha, DR Date of hearing: 25.08.2023 Date of pronouncement : 11.09.2023 O R D E R PER PRASHANT MAHARISHI, AM: 01. This is the Miscellaneous Application filed by the learned Assessing Officer in ITA No. 732/Mum/2019 dated 27 th December 2022 for A.Y. 2012-13. 02. This MA states following two errors in the order that :- a. coordinate Bench dismissed the appeal of the Revenue and has given liberty to the Assessing Officer to make application to reinstitute the Page | 2 MA No. 503/Mum/2023 M/s Topsgroup Electronic Systems Ltd; A.Y. 13-14 appeal as soon as the moratorium period as per IBC 2016 in case of assessee is over. Instead of that coordinate Bench should have kept the appeal pending. b. Inadvertently the assessment year mentioned is A.Y. 2013-14 in fact the correct A.Y. 2012-13. 03. The learned Departmental Representative vehemently submitted that the coordinate Bench has committed an error by dismissing the appeal of the Revenue holding that as assessee has been admitted as corporate debtor in Corporate Insolvency Resolution Process Under Section 9 of the IBC 2016, Insolvency Resolution Professional has been appointed, therefore, according to provisions of section 14 of the IBC 2016, the Revenue cannot continue any proceedings against the assessee. Thus, the appeal of the learned Assessing Officer was dismissed. It was stated that the coordinate Bench should have kept the appeal in abeyance to safeguard the interest of revenue. 04. It was further stated that there is an inadvertent error in mentioning the assessment year. The correct assessment year is 2012-13 where as coordinate bench has mentioned the assessment years 2013 – 14. 05. Therefore, the order suffers from mistake apparent from record that should be rectified. 06. Assessee despite notice did not respond and none appeared on behalf of it, therefore, the Miscellaneous Application is decided on the merits of the case as per Page | 3 MA No. 503/Mum/2023 M/s Topsgroup Electronic Systems Ltd; A.Y. 13-14 information available on record and as mistake pointed out by the learned assessing officer. 07. We have carefully considered the rival contention and perused the order of coordinate bench. We find that a. There is an error in mentioning the assessment year in the assessment order. Registry in all correspondences, folders and orders sheets have mentioned the AY as 2013-14 instead of AY 2012-13. The correct assessment year involved is A.Y. 2012- 13. Accordingly, the caption of the appellate order is corrected as A.Y. 2012-13 instead of assessment year 2013-14. b. With respect to the second contention that the co- ordinate bench should have kept the appeal of the learned assessing officer in abeyance so that the option might be available with the Department to recover its claim. We find that there is no error in the order of the coordinate bench as it is held that, in view of the provisions of section 14 of the IBC 2016, no proceedings can continue against the assessee. Thus, even keeping the appeal of ld AO in abeyance is also a violation of IBC 2016. Further, we have given liberty to the assessing officer to file a Miscellaneous Application as and when the moratorium in case of the assessee is over to reinstate the above appeal. Therefore, there is no error in the order of the coordinate bench and the interest of the revenue is adequately safeguarded Page | 4 MA No. 503/Mum/2023 M/s Topsgroup Electronic Systems Ltd; A.Y. 13-14 by giving liberty to the learned Assessing Officer. Now it is for LD AO to reinforce its claim before NCLT. 08. In the result, the miscellaneous application filed by the learned assessing officer is partly allowed. Order pronounced in the open court on 11.09.2023. Sd/- Sd/- (RAHUL CHAUDHARY) (PRASHANT MAHARISHI) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Mumbai, Dated: 11.09.2023 Sudip Sarkar, Sr.PS/Dragon Copy of the Order forwarded to: 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Mumbai