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TMI Blog2024 (10) TMI 984X X X X Extracts X X X X X X X X Extracts X X X X ..... d the assets of the corporate debtor through auction process under the IBC. Perusal of the scheme under the IBC and in particular Section 31, clearly prescribe that the resolution plan shall be binding on the Central Government, State Government or any local authority to whom a debt in respect of payment of dues arise under any law for the time being in force and the retrospective applicability of 2019 amendment to Section 31 is upheld by the Apex Court in the case of Ghanshyam Mishra Sons Pvt Ltd vs. Edelweiss Asset Reconstruction Company Ltd [ 2021 (4) TMI 613 - SUPREME COURT] . The Apex Court has categorically held that the amendment is clarificatory and declaratory in nature and it would apply retrospectively even in relation to pending proceedings and to the dues owed prior to the amendment. One of the dominant object of the IBC is to see to it that an attempt is made to revive the corporate debtor and make it a running concern and since it contemplate that the resolution applicant has to prepare a resolution plan on the basis of the information, memorandum and which is expected to provide for the payment of insolvency resolution process costs, implementation and supervision r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... recovered by the respondent Gram Panchayat and the bare minimum facts are culled out as below: (a) Gupta Global Resources Private Limited availed various credit facilities from the banks/financial institutions. However, since it was unable to repay the credit facilities, an application was filed under Section 10 of the Insolvency and Bankruptcy Code, 2016 (referred to as 'IBC' for the sake of convenience and brevity) before the National Company Law Tribunal, Mumbai (referred to as 'NCLT' for the sake convenience and brevity) for initiation of Corporate Insolvency Resolution Process (CIRP). The petition was admitted by the NCLT on 04.10.2017 and an Interim Resolution Professional (IRP) was appointed on the very same day. (b) On appointment of the IRP, by publishing the announcement in two newspapers, commenced the process on 10.10.2017, (i) by intimating the commencement of CIRP against the corporate debtor and (ii) calling upon the creditors to submit proof of claims, setting out the last date of submission of the claims as 21.10.2017. (c) A copy of the statement of claims submitted by the IRP was published on the website of the Insolvency and Bankruptcy Board of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etitioner, it was specifically expressed in Clause 6, that the sale and transfer of the assets of Gupta Global Resources Private Limited, including the washery, shall remain free from all encumbrances and shall be free from payment of any levies, taxes or dues levied on the assets of Gupta Global Resources Private Limited. It is the case of the petitioner that after execution of the Sale Certificate, it acquired the property and the act of the respondent in levying tax upon it, is unsustainable as during the entire Corporate Insolvency Resolution Process (CIRP) and the subsequent liquidation proceedings of Gupta Global Resources Private Limited, the respondent though a creditor, failed to submit its claim for recovery of taxes, under the provisions of the Maharashtra Village Panchayat Act, 1959. 5. The learned counsel for the petitioner has taken us through the scheme of the IBC and highlighted the position of the respondent in the context of an operational creditor of Gupta Global Resources Private Limited and in the legal framework, by inviting our attention to the actions of the respondent for recovery of the alleged dues, he would invite our attention to Section 124 of the Maha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this demand is affecting the rights of the petitioner which it had acquired during the liquidation process undertaken under the IBC-2016 and when the respondent has failed to lodge its claim before the Liquidator, the petitioner is not duty bound to satisfy the demand as regards the tax payable before acquisition of the assets by the petitioner. It is the specific case of the petitioner that the respondent has continued to persist with its unlawful action by disregarding sanctity of the process adopted under the Insolvency and Bankruptcy Code 2016 and once again on 31.12.2023 raised a demand of Rs. 47,05,868/- (Rs. Forty Seven Lakhs Five thousand Eight Hundred Sixty Eight) by the demand notice dated 31.12.2023 demanding tax from 2019 to 2024, despite the fact that the amount never formed a part of the claim submitted in the Corporate Insolvency Resolution Process or the subsequent liquidation proceedings of Gupta Global Resources Private Limited. 7. We have perused the writ petition which is accompanied with the orders passed by the NCLT, Mumbai Bench, from time to time, when the Gupta Global Resources Private Limited approached NCLT for initiation of the Corporate Insolvency Resol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and issue public announcement for submission of the claim within 30 days. The Liquidator also gave/issued public notice on 30.08.2018 requiring the claims to be submitted but the respondent failed to raise any claim even at this time before the Liquidator. The liquidation process moved ahead and the petitioner acquired the assets, in due process and now the respondent want to stake its claim for recovery of the amount of tax outstanding and payable to it by the corporate debtor but once the petitioner has acquired the assets of the corporate debtor, the claims, if any, which were not raised, stand extinguished and the respondent cannot now seek to recover those claims from the petitioner, who acquired the assets of the corporate debtor through auction process under the IBC. We have also noted that the Clause 6 of the sale certificate has conferred the property upon the petitioner free of encumbrances and free from payment of any tax, cess, charges, duty levied on the assets and we find substance in the argument of the learned counsel for the petitioner that the action of the respondent in seeking to recover the outstanding tax due to it under the Maharashtra Village Panchayat Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part of the resolution plan. 11. One of the dominant object of the IBC is to see to it that an attempt is made to revive the corporate debtor and make it a running concern and since it contemplate that the resolution applicant has to prepare a resolution plan on the basis of the information, memorandum and which is expected to provide for the payment of insolvency resolution process costs, implementation and supervision resolution plan, once such a plan is approved, it shall bind to one and all. The conclusion derived by the Lordships of the Apex Court in para 102.1 of the decision debars the respondent from opening up the process, since it never staked its claim during the proceedings under IBC-2016 and therefore, the claim stands extinguished, since it never formed part of resolution plan and therefore, the respondent is not entitled to recover any dues for the period prior to the date on which the adjudicating authority granted its approval and permission to the liquidation process and the sale certificate was issued to the petitioner. 12. Though we are convinced to quash and set aside the demand notices, as regards the liability to be discharged by the corporate debtor prior t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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