# In the matter of Tata Steel Ltd. vs. Deputy Commissioner of Income Tax

> HC judgment dated 2023-10-31. Citation: TCN-2023-HC-00023. The petitioner, Tata Steel Limited (TSL), challenged a notice and order issued by the revenue…

- **Court:** HC
- **Order date:** 31 Oct 2023
- **Citation:** TCN-2023-HC-00023
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/tata-steel-ltd-vs-deputy-commissioner-of-income-tax-57e86a35

## Summary

### Background

The petitioner, Tata Steel Limited (TSL), challenged a notice and order issued by the revenue demanding tax and penalty for various assessment years, arguing that these demands relate to periods preceding the approval of a Resolution Plan (RP) under the Insolvency and Bankruptcy Code, 2016 (IBC), and are thus extinguished by the 'clean slate' principle.

## Facts

Tata Steel Limited (TSL), formerly Bhushan Steel Ltd. (BSL), challenged a notice dated August 28, 2018 , issued under Section 221(1) of the Income Tax Act, 1961, and an order dated October 17, 2018, rejecting its objections. The notice demanded tax for Assessment Years (AYs) 2001-02, 2009-10, 2010-11, and 2013-14, totaling Rs. 257,80,81,038/-, and sought a response regarding penalty imposition. TSL argued that these demands, preceding the approval of its Resolution Plan (RP) by the National Company Law Tribunal (NCLT), were extinguished by the 'clean slate' principle under the Insolvency and Bankruptcy Code, 2016 (IBC). Insolvency proceedings against BSL were initiated by State Bank of India (SBI) under Section 7 of the 2016 Code, and the NCLT admitted the application

…

## Issues and analysis

### Issue 1: Whether the revenue is entitled to recover tax and penalty dues for periods preceding the approval …

**Ratio:** Once a resolution plan is duly approved by the adjudicating authority under Section 31(1)

…

**Reasoning:** The court reasoned that dues payable to creditors, including statutory creditors, for

…

**Interpretation:** The court interpreted Section 31 of the 2016 Code and the 'clean slate'

…

**Application:** Applying this interpretation, the court found the revenue's stance untenable.

…

## Parties

- **Judges:** RAJIV SHA…; GIRISH KAT…
- **Appellants:** Tata Steel…
- **Respondents:** Bhushan Steel…; Deputy Commissione…
- **Advocates:** Abhishek M.…; Mr Rajiv…; +8 more

## Timeline

- **March 31, 2003 — CIT(A) order for AY…**: The Commissioner of Income Tax (Appeals) reversed the addition made by the Assessing…
- **January 5, 2005 — Tribunal order for AY…**: The Income Tax Appellate Tribunal dismissed the revenue's appeal against the CIT(A)'s…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/high-courts-new-delhi/tata-steel-ltd-vs-deputy-commissioner-of-income-tax-57e86a35