Court dismisses writ petitions, orders assessment disclosure. Appeal rights granted. CIRP doesn't affect tax reopening.

The court dismissed the writ petitions, directing the respondent to provide the assessment orders to the petitioners within thirty days. It also granted the petitioners liberty to file an appeal before the Commissioner of Income Tax (Appeals) under Section 246A of the Income Tax Act, 1961, within thirty days from the communication of the assessment orders. The court emphasized that the Corporate Insolvency Resolution Process (CIRP) proceedings cannot dilute the rights of the Income Tax Department to reopen assessments under Section 148 of the Income Tax Act, 1961.

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Issues Involved:
1. Jurisdiction of proceedings under Section 148 of the Income Tax Act, 1961 during the Corporate Insolvency Resolution Process (CIRP).
2. Impact of the approved resolution plan on pre-existing tax claims.
3. Validity of reopening assessments under Section 148 of the Income Tax Act, 1961 post-approval of the resolution plan.
4. Rights of the Income Tax Department to proceed with reassessment under Section 148 of the Income Tax Act, 1961.

Issue-Wise Detailed Analysis:

1. Jurisdiction of Proceedings under Section 148 of the Income Tax Act, 1961 during CIRP:
The primary issue was whether the proceedings under Section 148 of the Income Tax Act, 1961 were without jurisdiction since the petitioners had voluntarily filed for CIRP under the Insolvency and Bankruptcy Code, 2016, which was admitted by the NCLT. The court noted that the CIRP applications were admitted by the NCLT, Mumbai on 12.03.2018 and 19.03.2018, while the notices under Section 148 were issued during March 2018. The court observed that the interim orders allowed the Income Tax Department to proceed with the assessment but directed them to keep the assessment in a sealed cover.

2. Impact of the Approved Resolution Plan on Pre-existing Tax Claims:
The court referenced the Supreme Court's decision in Ghanashyam Mishra & Sons (P) Ltd. Vs. Edelweiss Asset Reconstruction Co. Ltd., which held that once a resolution plan is approved by the NCLT, all claims not part of the resolution plan are extinguished. The court examined whether the resolution plan approved by the NCLT on 09.06.2020 included the tax claims. It was found that the resolution plan did not contemplate any concession from the Income Tax Department, and the proceedings under Section 148 had not crystallized at that stage.

3. Validity of Reopening Assessments under Section 148 of the Income Tax Act, 1961 Post-approval of the Resolution Plan:
The court emphasized that the resolution plan did not include the tax dues under the Income Tax Act, 1961. The objections of the petitioners were not in light of the voluntary CIRP initiated by them. The court highlighted that the petitioners should have ensured proper notice to the Income Tax Department and obtained appropriate concessions in the resolution plan. Since the claims of the Income Tax Department were not considered by the NCLT, the question of abatement of such rights could not be entertained.

4. Rights of the Income Tax Department to Proceed with Reassessment under Section 148 of the Income Tax Act, 1961:
The court concluded that the provisions of the Insolvency and Bankruptcy Code, 2016, cannot be interpreted in a manner inconsistent with other laws in force. Therefore, the CIRP sanctioned and approved cannot impinge on the rights of the Income Tax Department to pass fresh assessment orders under Section 148 read with Sections 143(3) and 147 of the Income Tax Act, 1961. The court held that the Income Tax Department was not precluded from reopening the assessment completed under Section 143(3) of the Income Tax Act, 1961.

Conclusion:
The court dismissed the writ petitions, directing the respondent to provide the assessment orders to the petitioners within thirty days. It also granted the petitioners liberty to file an appeal before the Commissioner of Income Tax (Appeals) under Section 246A of the Income Tax Act, 1961, within thirty days from the communication of the assessment orders. The court emphasized that the CIRP proceedings cannot dilute the rights of the Income Tax Department to reopen assessments under Section 148 of the Income Tax Act, 1961.

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