IBC has an overriding effect over the provisions of the Income Tax Act: ITAT

IBC has an overriding effect over the provisions of the Income Tax Act: ITAT

The assessee company is engaged in the business of construction and development of infrastructure projects. During the course of the appellate proceedings, the Ld.AR representing the assessee company had submitted details with regard to the proceedings before the Hon’ble National Company Law Tribunal under various provisions of the Insolvency and Bankruptcy Code initiated by Bank of Baroda as one of the lenders of the assessee company. The tribunal observed that the liquidation proceedings have commenced and there was an Official Liquidator appointed in the case of the assessee. We are aware that from the time of appointment of the Official Liquidator, the assessee company became defunct, and the Official Liquidator steps into the shoes of the assessee. The tribunal observed that no suit or other legal proceedings shall be initiated by or against the corporate debtor including pending proceedings and the Proviso to section 33(5) also provides prior approval of the Adjudicating Authority to be obtained by the Official Liquidator. Pertinently, it is also to be observed that in case of parallel proceedings under Income-tax Act, 1961 and IBC, 2016, the IBC has an overriding effect over the provisions of the Income-tax Act wherein had observed that as per section 238 of IBC, the IBC Code will override anything inconsistent contained in any other enactment, including the Income-tax Act. Thus, the cross-appeals filed by the Revenue and the Assessee were dismissed with the liberty to the appellants/Official Liquidator to recall the present order when the occasion warrants. Thus, the appeals filed by the Revenue and Assessee were dismissed.