Insolvency resolution plan extinguishes unprovided claims and leaves a pending tax appeal abated after approval.

Approval of the resolution plan under the Insolvency and Bankruptcy Code made the plan binding on all stakeholders, including the Central Government. Claims not included in the plan stood extinguished, and no proceeding could be continued for the pre-resolution period in respect of such claims. Applying this consequence, and the procedural effect under Rule 22 of the CESTAT Procedure Rules, 1982, the impugned demand order was treated as merged in the resolution outcome. The pending appeal therefore could not survive for adjudication on merits, and the appeal stood abated with the Tribunal functus officio in relation to it.

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Issues: Whether the appeal stood abated and the Tribunal became functus officio upon approval of the resolution plan under the Insolvency and Bankruptcy Code, 2016, with the result that the impugned demand order no longer survived.

Analysis: The approved resolution plan was treated as binding on all stakeholders, including the Central Government. Once the resolution plan was approved, claims not forming part of the plan stood extinguished and no proceeding could be continued in respect of such claims for the prior period. The Tribunal also relied on the procedural consequence under Rule 22 of the CESTAT Procedure Rules, 1982 and treated the impugned order as merged in the resolution process outcome. On that basis, the pending appeal could not survive for adjudication on merits.

Conclusion: The appeal stood abated and the Tribunal had become functus officio in relation to the appeal.

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