Authority: Calcutta High Court
Order Date: 14.10.2026
Case Overview
- Petition: WPA 10354 of 2026 filed by Tega Mcnally Minerals Limited (formerly Mcnally Sayaji Engineering Private Limited) against Union of India & others.
- Issue: Validity and maintainability of Income Tax reassessment for Assessment Year 2018‑19, challenged on the ground that a Section 31 order under the Insolvency and Bankruptcy Code, 2016 had been passed against the petitioner prior to the assessment.
- Background: The petitioner was admitted to Corporate Insolvency Resolution Process (CIRP) by an order dated 11 February 2021; a moratorium under Section 14 IBC was declared and an Insolvency Resolution Professional appointed. Public announcement of the CIRP was made on 15 February 2021.
- Legal Reliance: The petitioner relied on the Calcutta High Court judgment in Srei Equipment Finance Limited vs Union of India & Ors (2026 SCC Online Cal 14833) and Supreme Court judgments in Ghanashyam Mishra & Sons Pvt Ltd vs Edelweiss Asset Reconstruction Company Ltd (2021) 9 SCC 657 and Ruchi Soya Industries Ltd vs Union of India (2022) 6 SCC 343, asserting that successful CIRP extinguishes tax liabilities and related recovery proceedings.
- Respondents' Position: The respondents submitted written instructions, contending that the Supreme Court judgments are factually distinguishable, yet also acknowledged that Supreme Court precedents are binding and made no substantive distinction.
Final Outcome
- The Court disposed of WPA 10354 of 2026, directing that the reassessment proceedings for AY 2018‑19 be stayed.
- Respondents may initiate any further proceedings only after the Section 31 order under the IBC is finally passed.
Topics: Taxation, Insolvency