The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that a suit or proceedings could not be continued against a corporate debtor until the conclusion of proceedings taken place under Insolvency and Bankruptcy Code 2016 (IBC).
The assessee, Future Enterprises Limited, had been referred to the Corporate Insolvency Resolution Process under Insolvency and Bankruptcy Code 2016 and also furnished the copy of order of the NCLT dated 27.02.2023.
It was noticed that in the case of the assessee, Future Enterprises Limited the matter was pending before the Insolvency Professional in terms of Insolvency and Bankruptcy Code 2016 and moratorium period had been declared as per Section 14 of the IBC,
The National Company Law Tribunal had passed an order under Section 14 of Insolvency and Bankruptcy Code declaring a moratorium period, which prohibited institution of suits or any continuation of pending suits or any judgement, decree, order in any court of law, Tribunal, arbitration panel or other authority against the corporate debtor.
Rashmi Vyas, appeared on behalf of the assessee and Ankush Kapoor appeared on behalf of the revenue.
The two-member Bench of Amarjit Singh, (Accountant Member) and Sandeep Singh Karhail, (Judicial Member) held that asper the provision of Section 14 of the Insolvency and Bankruptcy Code till the conclusion of proceedings under IBC 2016 no suit or proceedings could be continued against the corporate debtor.
The ITAT bench referred to similar issues and identical facts in ACIT Vs. M/s Wizcraft International Entertainment Pvt. Ltd. dismissed the present appeal filed by the assessee in terms of the provisions of Section 14 of the Insolvency and Bankruptcy code with liberty to the assessee that as soon as the moratorium period was over the assessee may prefer the appeal afresh or recall the present appeal.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
