TaxTMI 
TaxTMI 
2024 (5) TMI 1637
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....ding of the Hon'ble Tribunal is given in Para 7. From the said finding the following can be seen: a. The Ld. Tribunal has, stated that neither there is a provision under the Income-tax Act, nor under the Sick Industrial Companies Act in this regard. The Tribunal has failed to consider the provisions of section 32(1) of SICA. Section 32 of the SICA is reproduced hereunder: "32. Effect of the Act on other laws.- (1) The provisions of this Act and of any rules or schemes made there under shall have effect notwithstanding anything inconsistent therewith contained in any other law except the provisions of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and the Urban Land (Ceiling and Regulation) Act....
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.... BIFR dated 23.03.2011 in case of the Hon'ble Delhi High Court. There is not a single word about the judgment of the Hon'ble Delhi High Court in the entire order. In the said order, in writ petitions filed by the Income-tax Department, the Hon'ble Court has held that each and every party which made concession at the stage, would abide by the same, even after the company has ceased to be sick. Such judgment has held that no party can go contrary to the scheme otherwise the order will loose its sanctity. By this means, even the other parties etc. would stop following the order. This cannot be permitted. The provisions of SICA has overriding effect over other laws to give effect to the rehabilitation proceedings. Non-consi....
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....nd clarified the position. The following is submitted in this regard: a. Circular: No. 523, dated 5-10-1988. "(3) Consequently, if the BIFR sanctions a scheme under section 17(3) of the Act specifically excluding or limiting the application of sections 41(1), 79 and 115J or of any one or more of these sections of the Income-tax Act, 1961 in respect of assessment years which are also specified, then the Assessing Officer will have to take due cognizance of this order and give effect to the same. Such a situation may arise in the case of a sick industrial company which has debited its account in respect of its interest liability in a particular assessment year. Subsequently, if in a scheme sanctioned by the BIFR, banks ....
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.... Cases already decided in accordance with the Circular Nos. 523 and 576 were however, not required to be reopened." Thus, from the above, it can be seen that the case of fiscal concession of 'financial assistance' under Direct Tax Laws will now be considered in each individual case on merits for the purpose of consent as contemplated in section 19(2) of SICA, 1985 and consent or denial of consent will be conveyed to BIFR by the Central Government. Even as per the said Circular, on a case to case basis the concessions have to be conveyed to BIFR and the ultimate decision is binding on the Tax Department. Thus, clearly, even the Tax Department accepted the fact that the concessions would be seen from case to cas....