Approval of a resolution plan under the IBC extinguishes all past dues, preventing any assessment or demand for liabilities incurred prior to that approval.

JUDGMENT :

(Mauna M. Bhatt, J.)

1. Heard learned Senior Advocate Mr.Tushar Hemani for learned advocate Ms.Vaibhavi K. Parikh for the petitioner and learned advocate Mr.Dev Patel for learned Senior Standing Counsel Mr.Varun K. Patel for the respondent.

2. Rule, returnable forthwith. Learned advocate Mr.Dev Patel waives service of notice of rule for and on behalf of the respondent.

3. This petition under Article 226 of the Constitution of India is filed challenging the Assessment Order under Section 147 read with Section 144B of the Income Tax Act, 1961 (for short ‘the Act’) dated 29.03.2022 and also the demand notice of even dated under section 156 of the Act, for the Assessment Year 2013-14.

4. The brief facts are as under:

4.1. The petitioner in this case is a Company incorporated under the provisions of the Companies Act, 1956. The Corporate Insolvency Resolution Process (for short ‘the CIRP’) under the Insolvency and Bankruptcy Code, 2016 (for short ‘the Code’) was initiated in the case of petitioner before the National Company Law Tribunal (for short ‘the NCLT’) and the Resolution Plan by Mr.Sunil Kataria and other was approved by Committee of Creditors.

4.2. The above referred Resolution Plan came to be approved by the NCLT vide order dated 05.10.2021 passed under the provisions of the IBC Code in IA No.197 (AHM) of 2021 in CP (IB) 770 of 2019. It is the case of the petitioner that thus, all the claims which have not been dealt with during the CIRP period or filed within the statutory period stood extinguished pursuant to the order passed by the NCLT.

4.3. subsequent thereto, IA No.793 of 2021 in CP(IB) No.770/NCLT/AHM/2019 was moved for minor modification in sub-clause XIII of clause 17 of the order of the NCLT dated 05.10.2021 and consequently, the NCLT passed an order dated 16.12.2021 in IA No.793 of 2021 in CP(IB) No.770/NCLT/AHM/2019 whereby subclause XIII of clause 17 of the order dated 05.10.21 was replaced.

4.4. Meanwhile, the case of the petitioner for the year under consideration was reopened by the respondent by issuance of notice dated 31.03.2021 under Section 148 of the Act. The petitioner, vide letter dated 21.02.2022 (filed on 23.02.2022) raised objections against the reopening. It was stated in the reply that the CIRP has been initiated in the case of the petitioner and the resolution plan has also been approved by the NCLT. Therefore, neither any notice could have been issued by the respondent nor any demand could have been raised by the respondent for the year under consideration and in view of the same, the respondent was requested to drop the reassessment proceedings.

4.5. However, the respondent vide order dated 20.03.2022 disposed of the objections raised against reopening and inter alia held that reopening is justified.

4.6. Subsequently, the respondent issued a show-cause notice dated 25.03.2022 calling upon the petitioner to show cause as to why variation proposed in the draft assessment order should not be made and the assessment should not be completed accordingly.

4.7. The petitioner, vide letter dated 27.03.2022 again submitted that the CIRP has been initiated in the case of the petitioner and the resolution plan has also been approved by the NCLT. Accordingly, neither any notice could have been issued by the respondent nor any demand could have been raised by the Respondent for the year under consideration.

4.8. The Respondent framed the assessment for the year under consideration under Section 147 read with Section 144B of the Act vide order dated 29.03.2022 determining total income of the petitioner at Rs. 1,35,54,576/-. Consequently, demand of Rs.4,61,73,520/- came to be raised.

4.9. The petitioner being aggrieved and dis-satisfied with Assessment Order passed under Section 147 read with Section 147 if the Act as well as the demand notice for the Assessment Year 2013-14 filed this petition.

5.1. Learned Senior Advocate Mr.Tushar Hemani for the petitioner submitted that in view of the settle