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TMI Blog2025 (3) TMI 1052X X X X Extracts X X X X X X X X Extracts X X X X ..... is binding on the first respondent. Therefore, the subsequent demand raised by the first respondent for the assessment years 2012-13 and 2013-14 is invalid.
Once the Resolution Plan is approved by the NCLT, no belated claim can be included therein that was not made earlier. If such demands are taken into consideration, the appellants will not be in a position to recommence the business of the CD on a clean slate.
The additional demands made by the first respondent in respect of the assessment years 2012-13 and 2013-14 will operate as roadblocks in implementing the approved Resolution Plan, and appellants will not be able to restart the operations of the CD on a clean slate.
We, therefore, hold that the demands raised by the first respondent against the CD in respect of assessment years 2012-13 and 2013-14 are invalid and cannot be enforced. X X X X Extracts X X X X X X X X Extracts X X X X ..... y the impugned judgment and order dated 25th November, 2021, the NCLAT dismissed the said appeal. SUBMISSIONS 3. The learned senior counsel appearing for the appellants submitted that the NCLT dismissed the application made by the second respondent without assigning any reasons. He pointed out that though no claim was received from the first respondent pertaining to the assessment year 2014-15 till the submission of the Resolution Plan, the Resolution Professional by itself admitted the liability of payment of income tax for the assessment year 2014-15, which was pending as a contingent liability of the CD. He relied upon a decision of this Court in the case of Committee of Creditors of Essar Steel India Ltd. vs. Satish Kumar Gupta & Ors. (2020) 8 SCC 531. He submitted that the issue was squarely covered by a decision of a Bench of three Hon'ble Judges of this court in the case of Ghanashyam Mishra and Sons Pvt. Ltd. through the authorised signatory v. Edelweiss Asset Reconstruction Company Ltd. through the Directors & Ors. (2021) 9 SCC 657. However, the NCLAT has brushed aside the said binding decision. He, therefore, submitted that the impugned orders of NCLT and NCLAT deserve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of pre-deposit for filing appeals, waiver of interest, penal interest or damages. These are issues to be decided by the respective government department and appropriate application may be moved before them." Now, the question is whether paragraph 44 has any relevance to the demands for income tax that were raised after the date of approval of the Resolution Plan. Subclause (g) of clause 2 of the Resolution Plan seeks relief and concessions referred to in paragraph 44 referred above. The sub-clause (g) relates to the contingent liabilities mentioned in clause 2. The income-tax liabilities for the assessment years 2012-13 and 2013-14 have not been shown as contingent liabilities under the Resolution Plan. Hence, what is observed in paragraph 44 is not relevant at all. 7. Section 31(1) of the IB Code provides for the legal effect of approval of the Resolution Plan. Section 31(1) reads thus: "(1) If the Adjudicating Authority is satisfied that the resolution plan as approved by the committee of creditors under sub-section (4) of section 30 meets the requirements as referred to in subsection (2) of section 30, it shall by order approve the resolution plan which shall be binding on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es owed to the Central Government, if not a part of the Resolution Plan, shall stand extinguished and no proceedings could be continued in respect of such dues for the period prior to the date on which the adjudicating authority grants its approval under Section 31 of the IB Code. In this case, the income tax dues of the CD for the assessment years 2012-13 and 2013-14 were not part of the approved Resolution Plan. Therefore, in view of sub-section (1) of Section 31, as interpreted by this Court in the above decision, the dues of the first respondent owed by the CD for the assessment years 2012-13 and 2013-14 stand extinguished. 9. We may note here that the decision of this Court in the case of Ghanashyam Mishra and Sons Pvt. Ltd.2 was specifically relied upon before the NCLAT. The decision of this Court was brushed aside by the NCLAT, firstly on the ground that the said decision was not relied upon before NCLT and, secondly, on the ground that the appellants have not challenged the Resolution Plan. Unfortunately, the NCLAT has ignored the binding precedent and the legal effect of the approval of the Resolution Plan as laid down in paragraphs 102.1 to 102.3 of the aforementioned de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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