Hon’ble ITAT Ahmedabad in case of ACIT Vs Pradip Overseas Ltd [ITA No. 543, 544 & 545/Ahd/2022] Date of Order: 04-10-2023 held that the Income Tax Settlement Commission has also passed order which is binding on the Revenue Department and the Assessing Officer has no power to reopen the assessment. The ld. CIT(A) has rightly held that claims which are part of the resolution plan stood extinguished as well as once the Income Tax Settlement Commission has decided/settled the tax component between the assessee and the revenue, the revenue authorities do not have any power to reopen such assessment.
Extract from case law:
7. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessment was framed u/s. 144 r.w.s. 147 of the Act dated 21-12-2018 making estimated addition. During the pendency of the appeal before the ld. CIT(A), the National Company Law Tribunal passed order dated 14-10-2021 whereby resolution plan approved by the Committee of creditors was approved and thus the same resolution plan is binding on all the parties such as Central Government and the related dues shall stand extinguished. This submission of the ld. Authorized Representative is a settle legal principle and therefore the same is accepted. The Income Tax Settlement Commission has also passed order which is binding on the Revenue Department and the Assessing Officer has no power to reopen the assessment. The ld. CIT(A) has rightly held that claims which are part of the resolution plan stood extinguished as well as once the Income Tax Settlement Commission has decided/settled the tax component between the assessee and the revenue, the revenue authorities do not have any power to reopen such assessment. Thus, there is no need to interfere with the finding of the ld. CIT(A). ITA 543/Ahd/2022 and 544/Ahd/2022 along with 545/Ahd/2022 are identical as per submissions of both the parties and hence the appeals of the revenue do not sustain. All the three appeals filed by the Revenue are dismissed.
8. In the result, all the three appeals filed by the Revenue are dismissed.
