SARE GURUGRAM PRIVATE LIMITED V. INCOME TAX OFFICER WARD INT TAX 3 1 1 DELHI & ORS.

W.P.(C)/10771/2024

AI Insights

The case involves SARE Gurugram Private Limited, the petitioner, who challenged the proceedings initiated by the Income Tax Officer under Section 201 of the Income Tax Act, 1961 for the Assessment Years 2014-15 and 2015-16. These proceedings were contested on the grounds that they were initiated post-moratorium date (09 March 2021) and concluded before or after the approval of the resolution plan (24 April 2023) under the Corporate Insolvency Resolution Process (CIRP). The petitioner argued that according to the 'clean slate theory', they should not be held liable for any demands or proceedings related to the period before the approval of the resolution plan if such liabilities were not included in the plan. The court's decision was guided by the Supreme Court's ruling in a similar case, which favored the petitioner.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 670894 (HC-DELHI)
• Appeal Type: Others
• Pronouncement Date: 30-04-2025
• Assessment Year: misc
• Other Referred Cases: Ghanashyam Mishra & Sons Private Limited through the Authorized Signatory v. Edelweiss Asset Reconstruction Company Limited through the Director & Others: Neutral Citation: 2021 INSC 250
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: DEBESH PANDA; ZEHRA KHAN; VIKRAMADITYA SINGH; ANAUNTTA SHANKAR; RAVICHA SHARMA; PIYUSH BERIWAL; KAUTILYA BIRAT; NIKHIL CHAUBEY; JYOTSNA VYAS
• Assessee Lawyers: ASHISH MEHTA; AANCHAL JAIN; BHARAT JAIN
• Keywords: Clean Slate Theory; Corporate Insolvency Resolution Process; Income Tax; Resolution plan
• Section: 201

Judgement Text

"$~116 * IN THEHIGHCOURTOF DELHIATNEW DELHI + W.P.(C) 10771/2024 & CM APPL. 44343/2024 SARE GURUGRAM PRIVATE LIMITED .....Petitioner Through: Mr Ashish Mehta, Ms Aanchal Jain and Mr Bharat Jain, Advocates. versus INCOME TAX OFFICER WARD INT TAX 3 1 1 DELHI & ORS. .....Respondents Through: Mr. Debesh Panda, SSC Ms. Zehra Khan, Mr. Vikramaditya Singh, JSCs Ms Anauntta Shankar and Ms Ravicha Sharma, Advocates for the Revenue. Mr Piyush Beriwal, Mr Kautilya Birat, Mr Nikhil Kumar Chaubey and Ms Jyotsna Vyas, Advocates for UOI. CORAM: HON'BLE MR. JUSTICE VIBHU BAKHRU HON'BLE MR. JUSTICE TEJAS KARIA O R D E R % 30.04.2025 1. The petitioner has filed the present petition, inter alia, impugning the proceedings, as referred in Annexure P1 to the present petition. The said Annexure is set out below:- “Impugned Proceedings carried out by Respondent(s) against the Petitioner The following proceedings by Respondent(s) were initiated / continued post Moratorium Date (ie 09 March 2021) and concluded before or after the approval of the Resolution Plan (ie 24 April 2023). AY Section & Initiation Date Demand (in INR/-) Authority before which the proceedings are pending Last notice date Response Date 2014-15 201; 08.02.2021 - Respondent 1 08.02.2021 - 2015-16 201; 15.03.2022 5,64,51,068 (demand raised vide order dated 30 March 2022) Pending before Respondent 2 to give appeal effect pursuant to favorable CIT(A) order dated 29.01.2024. The Petitioner has filed multiple applications before Respondent 2, however, no action has been taken yet. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 03/05/2025 at 15:24:30 2. The petitioner is essentially assailing the initiation of the proceedings under Section 201 of the Income Tax Act, 1961 [the Act] in respect of the Assessment Year [AY] 2014-15 and AY 2015-16. 3. Concededly, the proceedings relate to a period prior to 24.04.2023 being the date of the approval order in respect of a resolution plan prepared under the Corporate Insolvency Resolution Process [CIRP]. It is the petitioner’s case that in view of the clean slate theory, the petitioner cannot be vexed by any proceedings or demand, which relates to the period prior to the order approving the resolution plan, if the said dues or liabilities are not contemplated under the said plan. 4. Undisputedly, the controversy involved in the present case is covered in favour of the Assessee by the decision of the Supreme Court in Ghanashyam Mishra & Sons Private Limited through the Authorized Signatory v. Edelweiss Asset Reconstruction Company Limited through the Director & Others: Neutral Citation: 2021 INSC 250. 5. In view of the above, the present petition is allowed and all proceedings initiated in respect of AY 2014-15 and AY 2015-16 under Section 201 of the Act are set aside. 6. The petition is disposed of in the abovesaid terms. The pending application is also disposed of. VIBHU BAKHRU, J TEJAS KARIA, J APRIL 30, 2025 M Click here to check corrigendum, if any This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 03/05/2025 at 15:24:30 "