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TMI Blog2023 (11) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... leted within a limited and stringent timeframe. This was allowed so as to balance the interests of all stakeholders while being fully conscious of the objectives of timeliness in the completion of proceedings under IBC. Despite allowing two extensions of time to the Respondent, he failed to submit a responsive proposal and instead chose to file an appeal before the CESTAT. The object behind filing the appeal was to reach an end which was clearly different from the purpose for which time was allowed by this Tribunal towards full and final settlement. Instead of clearing the claims of the majority stakeholder, endeavours have only been made to dispute and stagger the claims by filing an appeal - In the process, the objectives of the IBC have been upset and defeated. Speed is the essence of IBC and the process of liquidation is time-bound to be completed within one year. Keeping in mind that the liquidation process in the instant case is already much delayed we do not find strong and cogent reasons to allow more time. Application disposed off. - [ Justice Ashok Bhushan ] Chairperson And [ Barun Mitra ] Member ( Technical ) For the Applicant : Mr. Sameer Rastogi, Mr. Aru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cepted by GST, in terms of this Tribunal s order dated 21.04.2023 and undertaking given by the Respondent on 20.05.2023, an email was sent by the Liquidator on 26.06.2023 to vacate the subject property. The Respondent instead of vacating the subject property, filed I.A. 2849/2023 before this Tribunal, inter-alia, praying for extension of timeline for a period of one month to comply to this Tribunal s orders of 21.04.2023 and 11.05.2023. This Tribunal on 07.07.2023 allowed the Respondent extension of one months time till 07.08.2023 but left it open for the liquidator to proceed thereafter with liquidation in accordance with the earlier judgement. The Respondent again submitted a revised settlement proposal on 01.08.2023 to the Liquidator which in turn was forwarded to the GST Department for their concurrence. As the GST Department did not respond to the revised settlement proposal, the Liquidator requested the Respondent on 09.08.2023 to vacate the subject property as per their undertaking given earlier. The Respondent instead of vacating the property has requested the Liquidator to reject the claim of Rs.8,26,68,028/- of the GST Department in view of the fact that an appeal filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TAT vide its order dated 17.07.2023 and 25.07.2023 had admitted the appeal for final adjudication. The CESTAT had allowed the delay condonation following which the Respondent had made a mandatory deposit of 7.5% of the principal amount which has led to a stay on the recovery of the claim amount. In support of their contention, attention was adverted to clause 4.2 of Circular No. 984/08/2014-CX issued by Ministry of Finance vide F. No.390/Budget/01/2012-JC dated 16.09.2014. It was pointed out that on the deposit of 7.5% of the principal amount, there is now a stay on the recovery mechanism of the GST Department and the claim cannot be admitted by the liquidator. 6. The Respondent submitted further that they had already sent an email on 01.08.2023 to the Liquidator apprising of this development and reiterating that GST dues are not recoverable till the final adjudication of the appeal. The claim of the GST Department has become invalid on the ground that the appeal is pending before the CESTAT and hence the claim filed by the GST Department has become infructuous. It has also been stated that the GST Department can no longer recover the claim amount under the IBC and its claim wil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of receipt of the same from the liquidator. (iv) In the event of any of the statutory creditors not having agreed to the settlement proposal within the stipulated period, the liquidator shall proceed with liquidation proceedings and the Appellant will have to vacate the subject property forthwith. An undertaking to this effect will be given by the Appellant to the liquidator before sending the settlement proposals for transmission to the statutory creditors. (v) In case all the statutory creditors agree to their respective settlement proposals and payments are made within the above stipulated timelines, the liquidation proceedings shall stand extinguished. In such event, the Appellant shall bear the lumpsum amount of liquidator s fees expenses which is fixed at Rs.20 lakhs. (vi) In case any of the statutory creditors fails to respond to the settlement proposal, it will be deemed that they have not agreed to the same and liquidation proceedings will commence forthwith. In such event, the liquidator shall claim his fees and expenses in terms of IBBI (Liquidation Process) Regulations, 2016. 9. This Tribunal had shown special consideration in allowing the Respond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... produced below: Circular No. 984/08/2014-CX dated 16.09.2014 5. Refund of pre-deposit: 5.1 Where the appeal is decided in favour of the party / assessee, he shall be entitled to refund of the amount deposited along with the interest at the prescribed rate from the date of making the deposit to the date of refund in terms of Section 35FF of the Central Excise Act, 1944 or Section 129EE of the Customs Act, 1962. 5.2 Pre-deposit for filing appeal is not payment of duty. Hence, refund of pre-deposit need not be subjected to the process of refund of duty under Section 11B of the Central Excise Act, 1944 or Section 27 of the Customs Act, 1962. Therefore, in all cases where the appellate authority has decided the matter in favour of the appellant, refund with interest should be paid to the appellant within 15 days of the receipt of the letter of the appellant seeking refund, irrespective of whether order of the appellate authority is proposed to be challenged by the Department or not. ( Emphasis supplied ) Clause 5.2 makes it clear that pre-deposit for filing appeal is not payment for duty . That being the case, the filing of the appeal cannot be viewed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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