2022 (12) TMI 730 - AT - Insolvency and Bankruptcy

CIRP - Recovery of dues of central excise duty form Corporate debtor - Revenue has not filed the claim when it was invited by the RP - non-provisioning for outstanding statutory dues of the Corporate Debtor (CD) plus interest at applicable rate in the Resolution Plan etc - HELD THAT - It is not in dispute that the Appellant/ Commissioner of Custom and Excise, Jaipur -I has not filed the claim while it was so notified by the RP. Even the claim has not been filed at the belated stage prior to approval of Resolution Plan by the CoC. The Appeal has been filed after the plan has been approved by the Adjudicating Authority. As a result of which the Appellant has not complied with the provisions of Section 13 15 of the Code - At this belated stage no fund is available out of the kitty of the Resolution Plan which can be earmarked to the Appellant as informed by the RP and the Resolution Applicant also. Both Resolution Applicant and RP has confirmed implementation of the plan and nothing remains to be adjudicated. It is very much clear that Section 238 of the Code provides very clearly that provisions of this Code to override other laws as also section 14 of the Code provides for moratorium during CIRP. Appeal dismissed.

Summary

Issues:
- Appeal under Section 61 of the Insolvency and Bankruptcy Code 2016 against the order passed by the National Company Law Tribunal, Kolkata Bench.
- Non-provisioning for outstanding statutory dues of the Corporate Debtor.
- Failure to pay excise duty on manufactured goods leading to a demand of Rs. 8,01,407/- along with penalty and interest.
- Clandestine clearance of finished goods without payment of central excise duty.
- Approval of Resolution Plan by the Adjudicating Authority.
- Allegation of abuse of process of law and non-maintainability of the appeal.
- Failure to file claim for statutory dues in the Resolution Plan process.
- Legal provisions overriding other laws during Corporate Insolvency Resolution Process.
- Application of relevant case laws regarding the filing of claims and resolution plan approval.
- Binding nature of approved resolution plan on all stakeholders, including creditors and government authorities.

Analysis:
1. The Appellant filed an appeal against the order of the National Company Law Tribunal, Kolkata Bench, under Section 61 of the Insolvency and Bankruptcy Code 2016, regarding non-provisioning for outstanding statutory dues of the Corporate Debtor. The appeal challenged the approval of the Resolution Plan by the Adjudicating Authority.
2. The case involved the failure of the Corporate Debtor to pay excise duty on manufactured goods, resulting in a demand of Rs. 8,01,407/- along with penalty and interest. The Adjudicating Authority confirmed this demand against the Corporate Debtor.
3. Additionally, the Corporate Debtor was found to be engaged in clandestine clearance of finished goods without paying central excise duty, leading to further demands and penalties.
4. The Resolution Plan was approved by the Adjudicating Authority, and the Appellant, a statutory authority, failed to file a claim for the outstanding statutory dues during the Resolution Plan process.
5. The Respondents argued that the appeal was an abuse of process of law and not maintainable, citing the commercial wisdom resting with the Committee of Creditors once a resolution plan is approved.
6. The judgment highlighted the importance of timely filing claims in the resolution process, as demonstrated in relevant case laws, and emphasized the binding nature of an approved resolution plan on all stakeholders, extinguishing claims not included in the plan.
7. Ultimately, the appeal was dismissed based on the legal provisions overriding other laws during the Corporate Insolvency Resolution Process and the specific circumstances of the case, where the Appellant failed to file a claim for the statutory dues, rendering the appeal untenable.