Income Tax Department appeal dismissed by Tribunal. Resolution Plan compliant with IBC. No interference in impugned order.

The Tribunal found no merit in the appeal filed by the Income Tax Department. The treatment of the claim in the Resolution Plan was in compliance with the IBC, and the appeal was disposed of with no interference in the impugned order.

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Issues Involved:
1. Treatment of the Income Tax Department's claim in the Corporate Insolvency Resolution Process (CIRP).
2. Compliance with Section 30(2) of the Insolvency and Bankruptcy Code (IBC).
3. Extinguishment of liabilities as per the Supreme Court's judgment in Jaypee Kensington.

Summary:

1. Treatment of the Income Tax Department's Claim:
The Appellant, Income Tax Department, filed a claim of Rs. 3334.29 Crores plus interest for AY 2010-11 and AY 2012-13. The Interim Resolution Professional (IRP) informed that the liability for AY 2010-11 was reduced to NIL and for AY 2012-13, it was shown as a contingent liability. The Resolution Plan submitted by Respondent Nos. 2 and 3 was approved by the Committee of Creditors (CoC) and the Adjudicating Authority, which provided only Rs. 10 Lakhs towards the Income Tax Department's claim. The Appellant contended that the claim was wrongly treated and that their filed claim was within the prescribed time.

2. Compliance with Section 30(2) of the IBC:
The Successful Resolution Applicant argued that the Income Tax Department did not file the claim within the stipulated timeframe, hence no payment was provided in the Resolution Plan. The Adjudicating Authority observed that the Income Tax Department's claim was not admitted as it was shown as a contingent liability. The Appellant argued that the demand for AY 2012-13 was confirmed and should not be considered non-existent. The Tribunal held that the claim for AY 2012-13 could not be said to be non-existent, but since the Income Tax Department is an Operational Creditor with a liquidation value of NIL, the payment of Rs. 10 Lakhs was not violative of Section 30(2)(e).

3. Extinguishment of Liabilities as per Jaypee Kensington Judgment:
The Respondents argued that the liability of Rs. 33,000 Crores was extinguished by the Supreme Court's judgment in Jaypee Kensington. The Tribunal noted that the Supreme Court did not specifically deal with the claim of the Income Tax Department nor did it observe that the claim stands extinguished. The Adjudicating Authority, in its order, did not grant blanket reliefs and concessions sought by the Successful Resolution Applicant regarding Income Tax liabilities. The Tribunal concluded that the claim of Rs. 33,000 Crores, which was not filed in the CIRP process, could not be considered extinguished.

Conclusion:
The Tribunal found no merit in the appeal filed by the Income Tax Department. The treatment of the claim in the Resolution Plan was in compliance with the IBC, and the appeal was disposed of with no interference in the impugned order.

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